How to start a SIP in a Nepali mutual fund: the Rs 1,000-a-month route

A cousin who started teaching two years ago does the same thing every payday. He moves Rs 1,000 into a separate account, watches it sit, and by Dashain it has usually been spent on something. Over chiya last month he asked the obvious question: if he is going to lock away Rs 1,000 anyway, where should it actually go so it compounds instead of evaporating.

A SIP into an open-end mutual fund is the cleanest answer for that exact amount of money. You set up an auto-debit once, Rs 1,000 leaves your account on a fixed day, and the fund manager buys you units at whatever the NAV is that day. No timing the market, no broker call, no IPO lottery. This post is the step-by-step for getting that running in Nepal, plus the loads, the tax, and an honest worked example.

Open-end vs closed-end: why a SIP needs the open kind

Before the setup, one structural fact decides everything. Nepali mutual funds come in two shapes, and only one of them supports a monthly drip.

Closed-end funds raise a fixed pool once, list on NEPSE, and run to a maturity date (typically 7 to 10 years). After the IPO closes you can only buy or sell units from another investor on NEPSE, at a market price that frequently sits at a discount to NAV, often 10-20% and sometimes wider. There is no way to push a fixed Rs 1,000 in every month at a known price.

Open-end funds have no maturity date and no NEPSE listing. You transact directly with the fund manager at the daily NAV, and the fund creates or cancels units to match (NIC Asia Capital). That is the machinery a SIP rides on. As of 2026, roughly thirteen of Nepal's ~56 active schemes are open-end; the rest are closed-end (Himalayan Times, April 2026).

Feature	Closed-end (NEPSE-listed)	Open-end (SIP-eligible)
Where you buy/sell	NEPSE, via broker	Direct from fund manager
Price you transact at	Market price (can be 10-20% under NAV)	Daily NAV
Maturity	Fixed, usually 7-10 years	None
Monthly auto-invest	Not possible	Yes, this is the SIP
Examples	Most listed closed-end schemes	NIBL Sahabhagita, SSIS, NMB Saral Bachat-E

If a fund trades on your NEPSE app under a ticker, it is closed-end and a SIP will not work on it. The deeper read on this split, NAV mechanics, and discounts lives in reading a Nepali mutual fund factsheet.

Which open-end funds take a SIP, and the minimum

Here is the part the chiya conversation actually needs. These are live open-end schemes whose fund managers run a SIP facility, with the published minimum installment.

Scheme	Fund manager	SIP minimum	Note
NIBL Sahabhagita Fund	NIMB Ace Capital	Rs 1,000/month	Nepal's first open-end scheme; no entry load
Siddhartha Systematic Investment Scheme (SSIS)	Siddhartha Capital	Rs 1,000/month	Daily NAV; 1.5% exit load within 1 year
NMB Saral Bachat Fund-E	NMB Capital	from Rs 1,000/month	First open-end scheme under NMB Mutual Fund
Nabil Flexi Cap Fund	Nabil Investment	SIP facility live	Rs 5 transfer fee/transaction; FIFO exit
NIC Asia Dynamic Debt Fund	NIC Asia Capital	SIP facility live	Debt-oriented open-end scheme

Sources: NIBL Sahabhagita Fund minimum Rs 1,000, SSIS FAQ minimum Rs 1,000 and 1.5% exit load, NMB Saral Bachat Fund-E, Nabil Flexi Cap Fund charges, NIC Asia SIP page.

Most schemes let you raise, lower, or pause the installment as your salary changes (NIC Asia Capital, SIP in Nepal). For a Rs 1,000 starter, an equity-oriented open-end scheme like NIBL Sahabhagita or SSIS is the usual pick; debt-oriented funds aim for steadier, lower returns.

A note on the par value: every Nepali scheme issues units at Rs 10 at launch, so an NAV of Rs 11.18 (SSIS, as of 2 June 2026, per Siddhartha Capital) means the portfolio is worth 1.118x the original contribution. A higher NAV usually just means the scheme is older, not better.

The actual enrolment, start to finish

The setup is a one-time afternoon of paperwork, then it runs itself. The pieces, in order:

1. Demat account (BOID). Your SIP units land in a demat account in dematerialised form, and you watch them in the Mero Share app from CDSC (NIC Asia Capital). If you already invest in shares or IPOs you have this. If not, open one through any broker or capital firm. Common pitfalls here are covered in Mero Share and demat mistakes.
2. KYC. A valid government-issued ID and the standard KYC details go on the application form (NIC Asia Capital). For SSIS you do not need a fresh demat; your existing BOID is enough (SSIS FAQ).
3. Pick the scheme and register online. Each fund manager runs its own SIP portal. NIMB Ace Capital, Siddhartha Capital, NMB, Nabil, and NIC Asia all have a registration form where you enter personal details, your demat (BOID), and the SIP amount and frequency.
4. Set up the auto-debit. This is the lever that makes it systematic. You authorise automatic debit at a fixed interval, commonly through a ConnectIPS mandate or a bank standing instruction (NIC Asia Capital, SIP in Nepal). On the chosen day, Rs 1,000 leaves your account and the fund allots units at that day's NAV.
5. Monitor and adjust. Units show up in Mero Share, and the fund manager posts NAV (daily for open-end schemes). You can change the amount or pause if a tight month comes.

The whole point is step 4. A SIP you have to fund manually every month is a savings habit you will skip during Dashain. The standing instruction removes the decision.

NAV, loads, and fees: what actually leaks out

A SIP is cheap relative to active trading, but it is not free. Three line items to know.

• Entry load. Generally nil on these open-end schemes. NIBL Sahabhagita charges no entry load, so every rupee buys units (NIMB Ace Capital).
• Exit load. Common in the first year, to discourage churn. SSIS charges 1.5% of applicable NAV if you redeem within one year, and nil after (SSIS FAQ). Nabil Flexi Cap redeems on a FIFO basis with an exit charge (Nabil Invest). A SIP is a multi-year commitment, so this only bites if you bail early.
• DP fee and management. A small DP fee per CDS bylaws applies on unit transactions (SSIS FAQ). The fund management fee is embedded in the NAV rather than billed separately; Nepali equity schemes typically run a total expense load in the 1.0-2.0% range, which the factsheet discloses.

The NAV you transact at is the day's published per-unit value. For SSIS it is calculated daily; for older closed-end comparisons the weekly NAV is what you would see. Buy on a low-NAV day and Rs 1,000 buys more units; that automatic averaging across high and low NAV days is the headline benefit of dripping monthly instead of lump-summing once.

Tax on a mutual fund SIP

The tax treatment is friendlier than on direct shares, because the fund is exempt at its own level and you are only taxed on what reaches you.

Event	Rate for a natural person	Note
Cash dividend from the fund	5% TDS, final	No further filing; final withholding
Redemption gain, units held over 365 days	5%	Long-term
Redemption gain, units held under 365 days	7.5%	Short-term
Income inside the fund (its dividends/interest)	Exempt at fund level	Avoids double taxation

Sources: dividend 5% final withholding, taxconsultantnepal.com and New Business Age on mutual fund tax treatment; capital gains 5% long-term / 7.5% short-term per Global IME Bank.

The 5% dividend TDS being final matters for a SIP investor: you do not bundle it into your salary tax return. The capital gains split rewards patience, which suits a SIP that you are meant to hold for years anyway. The mechanics overlap with capital gains tax on shares and the broader FD vs mutual fund vs CIT comparison.

What Rs 1,000/month could become (illustration, not a promise)

Here is the number my cousin actually wanted. The math below is a standard SIP future-value calculation, not a sourced fact, and the return rates are assumptions. Nepali mutual fund returns are not guaranteed.

The future value of a monthly contribution is:

FV = P × [((1 + r)^n − 1) / r]

where P is the monthly amount (Rs 1,000), r is the monthly rate (annual ÷ 12), and n is the number of months. For the return assumptions I use two anchors: a conservative 8% and a more optimistic 10%. The 10% sits near NEPSE's long-run record of roughly 8.69% CAGR over 22 years excluding dividends (Investopaper); add a few years of dividends and a mid-performing equity fund and 10% is a defensible upper planning figure, not a forecast.

Years	Your contributions	Corpus at 8% (illustrative)	Corpus at 10% (illustrative)
5	Rs 60,000	Rs 73,500	Rs 77,400
10	Rs 1,20,000	Rs 1,82,900	Rs 2,04,800
15	Rs 1,80,000	Rs 3,46,000	Rs 4,14,500
20	Rs 2,40,000	Rs 5,89,000	Rs 7,59,400

Two honest readings of that table. In the first five years almost all of the corpus is just your own deposits; at 10%, Rs 77,400 against Rs 60,000 in is only Rs 17,400 of growth. By year 20 the relationship flips: Rs 7.59 lakh against Rs 2.4 lakh deposited means compounding has done more than half the work. This is the same contributions-then-compounding curve described in the first Rs 10 lakh is harder than the next, just at a smaller monthly figure.

The other honest reading: a bad NEPSE stretch can flatten this. Open-end funds posted mixed dividends in FY 2081/82, ranging from a 16% cash dividend at Shubha Laxmi Kosh down to no dividend at SSIS, Sanima Flexi, and Prabhu SIS (Investopaper dividend tracker). NIBL Sahabhagita has averaged a 12.74% dividend across six fiscal years and paid 7% in FY 2081/82 (NEPSE Stock), but a single year tells you little. The table is a planning tool, not a guarantee.

Whether a SIP beats parking the same Rs 1,000 in an FD, and how it stacks against direct NEPSE buying, is the whole argument in NEPSE vs SIP vs FD at 25 in Kathmandu.

Tracking your SIP in Kharchapatra

For the habit to survive past the first three months, the bookkeeping has to be near-zero effort:

• Log the monthly debit as a recurring Transfer, not an Expense. Set Rs 1,000 on your SIP debit date, moving from your salary account to an investment account named for the scheme (for example "NIBL Sahabhagita SIP"). It is your money changing form, not money spent.
• One account per scheme. If you run SIPs in two funds, keep them separate so you can see which is actually working rather than a blended blur.
• Update the balance with the NAV, quarterly. Open-end NAVs move daily, but checking daily trains you to react to noise. Once a quarter, mark the account to units × current NAV. The gap between that balance and your cumulative contributions is your compounding showing up.
• Record dividend payouts as inflows to the same account. With the 5% TDS already deducted, log the net amount so your year-end yield is honest.

The dashboard's job is to make the 20-year view legible while you do nothing. Around year four or five, the balance line lifts off the straight contributions line, and that lift is the answer to "is this worth it."

What you actually need to know

Three takeaways:

1. A SIP only works on open-end funds, the dozen-odd schemes you buy directly from the fund manager at NAV, not the closed-end ones on NEPSE. Rs 1,000/month is the realistic entry across NIBL Sahabhagita, SSIS, and NMB Saral Bachat-E.
2. The setup is one afternoon, then automation. Demat plus Mero Share, KYC, register on the fund's portal, and wire up a ConnectIPS or bank auto-debit. The standing instruction is the whole point; it removes the monthly decision.
3. The math rewards time, not cleverness. At an illustrative 10%, Rs 1,000/month is about Rs 7.6 lakh after 20 years, with compounding overtaking your contributions somewhere around year 12-15. The returns are not guaranteed, so the lever you control is starting and not stopping.

Running a SIP already, or stuck on which open-end scheme to start with on Rs 1,000? Email parjanya57@gmail.com and I'll work through it.

This post is part of the Nepal Money Basics guide — the investing section.