Cut-off time is the deadline by which a mutual fund transaction must be submitted and the funds must be received to get that day's NAV — miss it and you get the next business day's NAV.
SEBI mandates cut-off times to determine which day's NAV applies to a transaction. For liquid and overnight funds, the cut-off time is stricter (1:30 PM for purchases and redemptions). For all other equity and debt funds, the cut-off time is 3:00 PM on business days. Only transactions where both (a) the application is received and (b) the funds are credited to the fund house's account before the cut-off time get the same-day NAV. After the cut-off, the next applicable business day's NAV is used.
Cut-off time works like the last boarding call for a flight — miss it, and you're on the next day's flight (NAV). If you submit a SIP or lumpsum before 3:00 PM on a trading day AND the money reaches the fund house by then, you get today's NAV. Submit at 3:01 PM or later → you get tomorrow's NAV. For liquid funds, the cut-off is even earlier: 1:30 PM.
Liquid/Overnight funds: 1:30 PM cut-off for same-day NAV.
All other funds (equity, debt, hybrid): 3:00 PM cut-off for same-day NAV.
Both application receipt AND fund credit must happen before the cut-off.
NEFT/RTGS transfers: settlement timing affects whether funds are received before cut-off.
Online platforms with UPI/Net Banking often ensure same-day receipt if transacted well before the cut-off.
You want to invest ₹10 lakh in a liquid fund on Monday: - Submit at 12:45 PM, RTGS credited by 1:15 PM → you get Monday's NAV. - Submit at 12:45 PM, but RTGS credits at 2:00 PM → you get Tuesday's NAV. - Submit at 1:35 PM (after cut-off) → you get Tuesday's NAV. For a ₹10 lakh investment at ~6% annual yield, missing one day's NAV costs roughly ₹165.