What is STP and how to create one on Coin web?

An STP (Systematic Transfer Plan) helps make investing easier by automatically moving money from one mutual fund to another. It combines features of both a SWP (Systematic Withdrawal Plan), where money is withdrawn from a fund, and a SIP (Systematic Investment Plan), where regular investments are made into a fund.

Through an STP, money can be regularly moved from one fund to another, such as from a Liquid fund to an Equity fund automatically, without any manual efforts. On Coin, STP allows transfers across funds from different companies. The redeemed amount is first credited to the bank account, and then a bank mandate is used to reinvest it into the chosen fund. Before creating an STP on Coin, ensure that an active mandate is set up in the account.

To create an STP on Coin web, follow these steps:

1. Click on Dashboard, and then on Mutual Funds.
2. Select the mutual fund from which funds will be transferred.
3. Click on the context menu and then on Create STP.
4. In the order window, view details such as units held, investment value, and free units (for ELSS or retirement funds)
5. Name the STP order.
6. Enter the transfer amount.
7. Select the frequency (monthly or weekly) and date or day accordingly.
8. Choose the mandate from the dropdown.
9. Select or search the mutual funds from the holdings to which the amount will be transferred (up to 5 mutual funds can be selected, and transfers are allowed across all AMC schemes).
10. Enter the transfer amount for each selected scheme; the default will show the minimum investment amount for each scheme.
11. Click on Create STP and then on Confirm.

Once the STP order is created, it can be tracked from the STP tab, where there are options to pause, resume, or delete the STP orders.

Did you know?

• A mandate is required for the process. The funds are first credited to the bank account and then sent for investment in new schemes. If the debit request fails, UPI Autopay allows up to 9 retries in a day, while eNACH provides only one attempt.
• Transfers are allowed only between schemes already in the holdings. If a scheme is not part of the holdings, it cannot be used for STP. Setting up an STP is only possible for schemes that are part of the current holdings.
• After the redemption amount is credited to the client's bank account, a debit request is made depending on the mandate type (Autopay or eNACH). Based on this, the amount will be debited on T+1 day for UPI Autopay or T+2 day for eNACH.
• Taxation, exit load, and other charges will apply according to the redemption scheme, which is similar to a traditional STP. The P&L report for STP transactions can be seen on Console.
• STP is currently available only on the Coin web platform, but it will be available on the Coin app soon.