Table of Contents
Introduction
In recent years, the concept of Systematic Investment Plan (SIP) has gained significant traction among Nepali investors. SIP offers a disciplined and straightforward approach to investing, making it accessible even to those with limited financial knowledge or resources. This article delves into the fundamentals of SIP, its workings in the Nepali context, and provides insights into the available SIP options, their performance, and future prospects.
Understanding Systematic Investment Plan (SIP)
A Systematic Investment Plan (SIP) is an investment strategy where individuals invest a fixed amount of money at regular intervals—such as monthly or quarterly—into mutual funds. Instead of making a lump-sum investment, SIP allows for smaller, consistent contributions, making it easier for individuals to start investing without significant capital.
Key Features of SIP:
Regular Investments: Invest a predetermined amount periodically.
Flexibility: Choose the investment amount and frequency based on personal financial goals.
Affordability: Start with as little as NPR 1,000 per month.
Accessibility: Invest from anywhere, even abroad, through digital platforms.
How Does SIP Work in Nepal?
In Nepal, SIPs function similarly to global markets but are tailored to the local financial landscape. Here’s a step-by-step breakdown:
- Choose a Mutual Fund Scheme: Select a mutual fund based on your financial goals and risk tolerance.
- Open a DEMAT Account: Required for holding and managing your investments.
- Complete KYC Process: Submit necessary documents like citizenship or national ID.
- Set Investment Amount and Frequency: Decide how much and how often you want to invest.
- Start Investing: Begin your SIP through online platforms or financial institutions.
By investing regularly, you purchase mutual fund units at varying prices, averaging out the cost over time—a concept known as Rupee Cost Averaging. This strategy helps mitigate market volatility risks.
Benefits of SIP in Nepal
1. Power of Compounding
Earnings from your investments are reinvested, generating additional earnings over time. This compounding effect can significantly boost your wealth in the long run.
2. Financial Discipline
Regular investments instill a habit of saving and investing, promoting financial discipline.
3. Flexibility and Convenience
SIPs offer flexibility in terms of investment amount and frequency. They can be managed online, making them convenient for both domestic and international investors.
4. Accessibility for All
With a low entry point, SIPs are accessible to individuals across various income levels, enabling more people to participate in the financial markets.
SIP Options Available in Nepal
As of now, several mutual funds in Nepal offer SIP (Systematic Investment Plan) options. These funds are managed by licensed Asset Management Companies (AMCs) and are regulated by the Securities Board of Nepal (SEBON). Each of these mutual funds has its own structure, investment strategy, and expected returns. Here’s a brief explanation of each:
1. NIBL Sahabhagita Fund (NIBLSF)
NIBL Sahabhagita Fund is an open-ended mutual fund managed by NIBL Ace Capital. It is one of the most popular SIP choices in Nepal. Since it is open-ended, you can invest and withdraw anytime without waiting for the fund to mature. This fund primarily invests in shares of listed companies, government bonds, and other secure financial instruments.
Over time, NIBLSF has maintained a healthy growth rate, and because of its diversified portfolio and good fund management, many investors—especially beginners—have preferred it for regular monthly SIPs. It also allows investment through online payment channels like eSewa and Connect IPS.
Dividend History:
- FY 2076/77: 8.25% cash dividend
- FY 2078/79: 7.2% cash dividend
- FY 2079/80: 4% cash dividend
✅ Suitable for: Long-term investors seeking capital growth with moderate to high risk.
2. Siddhartha Systematic Investment Scheme (SSIS)
SSIS is another systematic SIP product managed by Siddhartha Capital. This fund allows investors to put in money at regular intervals and benefit from market growth while spreading risk over time. Siddhartha Capital is one of the pioneers in Nepal’s mutual fund space, and they’ve promoted SIP culture through SSIS by educating investors.
The scheme focuses on a mix of equities and fixed-income securities. It has shown steady performance over the years, even during market fluctuations. Many salaried individuals and students have found it a good starting point due to its brand reputation and flexible entry level.
✅ Suitable for: New investors seeking simplicity and reliable fund management.
3. NMB Saral Bachat Fund-E (NMBSB-E)
Managed by NMB Capital, NMBSBE is focused on encouraging savings through SIPs. The word “Saral” means simple, and as the name suggests, this fund is designed to make investing easier and more accessible for everyone.
It mostly invests in lower-risk assets like bonds and blue-chip stocks, so the risk is lower compared to aggressive equity funds. This makes it a good option for risk-averse investors or people with short- to mid-term financial goals.
✅ Suitable for: Conservative investors or those looking for a safer SIP option.
4. NIC Asia Dynamic Debt Fund (NADDF)
This fund is managed by NIC Asia Capital and focuses heavily on debt instruments like government securities, fixed deposits, and corporate bonds rather than shares. Since debt-based mutual funds are less volatile than equity-based ones, this fund provides stability and consistent returns.
NADDF is especially useful for investors who want capital protection and a predictable income from their investment. It’s not as aggressive as other growth-focused funds, but it offers peace of mind.
✅ Suitable for: Senior citizens, short-term savers, or low-risk investors.
5. Kumari Sunaulo Lagani Yojana
Managed by Kumari Capital, this is a relatively newer entry into the SIP mutual fund space. The word “Sunaulo” means golden, indicating the long-term wealth-building goal of this scheme. It is designed to attract first-time investors who want to start small and gradually increase their investments.
Kumari Capital has created this SIP to be beginner-friendly, offering support both in-person and online. The fund includes a mix of equity and fixed-income securities. Though relatively young, early performance indicators have been promising.
✅ Suitable for: Young professionals or new investors looking for growth opportunities.
6. Shubha Laxmi Kosh
Shubha Laxmi Kosh is offered by Sunrise Capital and is structured as a balanced mutual fund scheme. It seeks to deliver steady returns while managing risk. The fund name itself—Shubha Laxmi—symbolizes wealth and prosperity.
This fund allows investors to start with small SIP amounts and gradually build wealth through disciplined saving. It targets women, small investors, and new market entrants with a simplified application and investment process.
✅ Suitable for: Beginners or women investors focusing on medium-term financial goals.
This is one of the most flexible SIP funds available in Nepal. Managed by Nabil Investment Banking, this fund allows the fund manager to invest across companies of all sizes—small-cap, mid-cap, and large-cap—based on market conditions. This flexibility provides an opportunity for high growth but also comes with slightly higher risk.
The Nabil Flexi Cap Fund has recently received attention due to its dynamic allocation style and promising early returns. Since it’s actively managed, it suits investors who are ready to stay invested for a long term and can tolerate market ups and downs.
✅ Suitable for: Intermediate to advanced investors aiming for high capital appreciation.
What is the Future of SIP in Nepal?
The future of SIPs in Nepal looks very promising. As financial literacy improves and more people become aware of long-term investment benefits, SIP adoption is expected to grow. Asset management companies are also actively promoting SIP through digital tools, mobile apps, and simplified platforms. With increased participation from youth, working professionals, and even NRNs (Non-Resident Nepalis), SIP will likely become the most preferred method of investing in Nepal in the coming years.
As more funds launch and regulations strengthen, investors will have even more options and better fund performance transparency. If you’re considering starting a SIP, the present time is a great opportunity to begin your financial journey.
How to Start a SIP in Nepal: Step-by-Step Guide
Starting a SIP (Systematic Investment Plan) in Nepal is simpler than most people think. You don’t need to be an expert in the stock market, nor do you need to have a huge amount of money. With as little as NPR 1,000 per month, anyone can begin their investment journey. Here’s a clear step-by-step guide to help you or your readers get started with SIP in Nepal:
Step 1: Open a DEMAT Account
Before you can invest in mutual funds or shares, you need to have a DEMAT account. This account holds your mutual fund units in electronic form—just like a bank account holds money.
- Visit any bank, capital company, or broker that provides DEMAT services.
- Fill out the DEMAT form and submit your citizenship copy, passport-size photo, and signature.
- You’ll receive a BOID number after a few days, which you’ll need for mutual fund investment.
Note: You can also apply online through many banks and capital providers.
Step 2: Complete Your KYC (Know Your Customer)
KYC is a one-time verification process to confirm your identity and address. It’s mandatory before investing in any financial instrument in Nepal.
- Fill out the KYC form (usually available at the mutual fund company’s website or office).
- Submit a copy of your citizenship, passport-size photo, and signature.
- This process is usually completed alongside your Demat application.
Step 3: Choose the Mutual Fund That Offers SIP
Now that your accounts are ready, it’s time to select the right SIP plan. In Nepal, several mutual funds offer SIP options, such as:
- NIBL Sahabhagita Fund
- Nabil Flexi Cap Fund
- Kumari Sunaulo Lagani Yojana
- NIC Asia Dynamic Debt Fund
- And more
Consider the fund’s past performance, risk level, and your personal financial goals before selecting one.
Step 4: Decide Your SIP Amount and Frequency
SIP means you invest a fixed amount at regular intervals. Most SIPs in Nepal offer monthly or quarterly options.
- You can start with NPR 1,000 or more per month.
- Decide whether you want to invest manually or automate the process.
Tip: Start with an amount you’re comfortable with. You can increase it later.
Step 5: Set Up the Payment Method
Once you’ve decided on the amount and frequency, the next step is to make the payment.
- Most mutual funds allow manual payment through platforms like Connect IPS, eSewa, or Khalti.
- Some also allow standing instructions from your bank so that the amount gets auto-deducted every month.
Example: If your SIP is Rs. 2,000 monthly, you can pay it every month from your phone using a QR code or login through the mutual fund’s portal.
Step 6: Submit the SIP Application Form
To officially start your SIP, you’ll need to fill out and submit the SIP form provided by the mutual fund company.
The form includes:
- Your name and BOID
- Selected SIP amount
- Investment period (for example: 3 years, 5 years)
- Bank/payment details (if using auto-debit)
- Signature and date
Most forms are available on the fund’s official website. Some even allow you to submit them digitally.
Step 7: Get Confirmation & Track Your SIP
After your first payment, you’ll receive a confirmation email or SMS. You can then monitor your investments through:
- The mutual fund company’s dashboard
- The Mero Share platform (to see units allocated)
- Your Demat account statements
Check regularly to see how your investment is growing. You can also download the SIP schedule and statements anytime for your records.
Step 8: Review and Adjust if Needed
Once you’ve started your SIP, you can:
- Increase the amount (called a top-up)
- Pause the SIP for a month (in most plans)
- Cancel or redeem your units if you need funds
- Switch to a different mutual fund later
Tip: SIP is meant for the long term, so be patient and consistent. Even if the market fluctuates, keep investing—it helps average out the cost and build wealth over time.
Starting a SIP in Nepal is now easier than ever. With just a few documents and a small monthly contribution, you can build a disciplined habit of investing for your future. Whether you’re a student, employee, or self-employed, SIP is a simple way to turn small savings into big wealth over time.
Conclusion
SIP is one of the easiest and most effective ways to start investing in Nepal. With just a small monthly amount, you can build long-term wealth without needing deep knowledge of the share market. Thanks to low entry requirements, flexible plans, and online access, SIP is now more beginner-friendly than ever.
Whether you’re saving for your future, your family, or simply building financial discipline, starting a SIP today can lead to big rewards tomorrow. Start small, stay consistent—and let time do the rest.