Jio savings pro: How long does it take to get money back from overnight mutual funds to your savings account

Overnight mutual funds are a great way to earn a little extra on your money that's lying idle, and thanks to recent changes by Securities and Exchange Board of India (SEBI) and initiatives from various AMCs and banks, getting your money back from overnight mutual funds have become faster and more flexible than ever.

Here is a simple breakdown of how long does it take to get money back from overnight mutual funds to your savings account

Instant redemption facility: How it works

For smaller amounts, many platforms now offer instant redemption facility meaning your money can reach your savings account within minutes.

Jio’s facility allows investments of up to ₹1.5 lakh per day and follows SEBI’s guidelines for processing redemptions. According to the bank, amounts above ₹50,000 or the 90% cap are credited via the usual mutual fund timelines.

“Customers can invest up to ₹1,50,000 per day through this facility. Redemptions are processed in accordance with the guidelines set by the Securities Exchange Board of India (Sebi). Customers have the flexibility to instantly redeem up to 90% of their investments, with a maximum instant redemption limit of Rs 50,000. Funds exceeding this amount can be redeemed within 1 to 2 working days," as per the payments bank’s press release.

PPFAS Mutual Fund also offers a similar "Instant Access Facility" for its overnight scheme. The terms are the same, and the amount gets credited to your bank account on the same day via IMPS.

SEBI first allowed such instant redemptions for overnight mutual funds in 2021, giving AMCs the option to offer same-day payouts under defined limits.

Since then, several fund houses, including Aditya Birla Sun Life, Axis, ICICI Prudential, Nippon India, Sundaram, and PGIM have rolled out similar features.

Standard redemption process & timings

For redemptions that don't qualify for instant access, the timing of your request is crucial. SEBI has specific cut-off times that determine when your transaction is processed.

⦁ For online redemptions from overnight funds, there is a special cut-off time of 7 PM.

⦁ For all other redemptions (including offline requests), the cut-off time is 3 PM.

• If you request a redemption before the cut-off time on a working day, your transaction is processed on the same day's NAV. The payout from the fund house to your bank account then happens on the next working day (T+1).

• If you request a redemption after the cut-off time, your request is processed on the next business day's NAV. This means the money will be credited to your account on the following working day (T+2).

Disclaimer: This article is written purely for informational purposes and should not be considered investment advice from Upstox. Investors should do their own research or consult a registered financial advisor before making investment decisions.