Banks are charging arm and a leg for unfilled SIP transactions (for the lack of funds) and multiple attempts by Coin is only making matters worse.
I request you to be upfront about these things at the time of creating mandates:
explicitly state how many times such attempts will be made
approx. how much an investor can end up paying if they don’t have sufficient balance.
maybe even send a reminder a day prior to make sure that the investor keeps that balance in the bank account.
Here’s a video that sheds light on this issue. Basically, a charge of 6400 was made just because four SIP orders didn’t go through.
It may not be a big amount for some but for most investors, a few such cases can create serious dent in their willingness to do SIPs and take them away from systematic investing.
Thanks for reading and sorry if I missed anything.
They state “SIPs won’t be retried if mandate payment fails.” from here
Zerodha has no way of knowing this. It changes bank to bank. And even within a bank it depends on account variant - basic, premium, etc. You should check your own bank charge list.
This is sent by some platforms, I think sent by Kuvera. Not sure about coin.
Which bank is charging 1600 per mandate bounce? Do you have a source?
He is telling Axis Bank but as per this it is 500?
We try it only once; if the transaction debit request fails, we do not do any retry.
We give the investor an option to pause the SIP 2 days prior if the SIP is linked to the mandate, unlike other platforms we have not made a mandate compulsory for a SIP.
We do send reminders 2 day prior to your registered email id when the instruction is triggered from our end to the Mandate partner. We will soon start with app notifiers as well, but you can track these in your email id.
The bank charges per debit instruction vary from bank to bank. Generally, the charges are 250 + GST with the banks per debit instruction. This should be clarified more with the bank, and if you can DM us the User ID then we can explain what went wrong here as there seems to be some details that are incorrect on the video created as we do not retry a failed transaction.
Further in the video the bank said they will be reverting these charges but there seems to be an issue with the bank here.
Hi Neha,
So, at Zerodha we try only once as informed by our team member Neelesh , can you ask the person in that video to check with the bank again and let us know? also would appreciate to make necessary corrections in the video regarding zerodha once you get more info.
Just so that it is clear, this video raised concerns on the bank side.
Zerodha never charged anything extra nor did they mislead in any fashion. The reason I created this post was to see if there is something that can be done from Zerodha’s end to prevent this from happening.
The very fact that Axis Bank was so quick to refund shows that they were in the wrong.
Axis Bank has again confirmed that the extra charge were due to multiple attempts that (they claim) were made through Zerodha. There is no way for us to validate what happened really.
Anyway, the intent of this post is to avoid this from happening to fellow investors.
The fact is that hundreds or even thousands of investors would be hit with such fees every day but very few will have the time and awareness to fight back.
