When you invest in a Systematic Investment Plan (SIP) online, you select the scheme and make the first investment into it through any digital payment mode. After making the first contribution, you need to make provisions for the subsequent contributions. This provision is a mandate wherein you instruct your bank account to deduct the SIP amount automatically whenever it is due.
The OTM ( one time mandate) facility is one of the most convenient facilities of investing in SIPs. Let’s understand what it is and what are the benefits provided –
A One Time Mandate (OTM) is a one-time registration through which you instruct your bank account to deduct a specified amount of money from your account daily towards investing into a SIP portfolio. Once you register for OTM, you don’t have to follow the payment process every time you invest in the SIP.
To ensure that your SIP investments continue non-stop, you have to submit a mandate to your bank account for deduction of the SIP amount every month. Choosing OTM as the mandate is beneficial because of the following reasons –
On Groww , the mandate can be given in two ways: autopay via OTP and autopay via form. Here is what you should know:
AutoPay is the next iteration of the biller mandate but is more convenient than before. It helps in automating the monthly payments towards your SIPs. Once the AutoPay is done, your monthly payments towards SIP will be done automatically without any intervention. It saves you the hassle of manually making payments towards your SIP. Also, it is quick to set up and completely safe.
Read more on Groww: How to Set-up Autopay via OTP on Groww
The Auto-pay via Form (previously known as OTM) is a one time process to setup a mandate, to enable recurring payments through a NACH form. This process is suitable for investors who, for some reason, do not have access to net banking facilities or simply wish to go this route.
Read more on Groww: How to Set-up Autopay via Form on Groww
The One Time Mandate, therefore, is a beneficial way of investing in SIPs. It acts like an e-wallet for investing in SIPs wherein your investments are done with the easiest payment mode and you don’t have to go through the payment process for every investment. So, the next time you opt for a SIP, add the One Time Mandate to your folio and transact with ease.