Exit load explained: the fee for leaving early

An exit load is a fee charged when you redeem (sell) your mutual fund units within a specified period after buying them. It's a percentage of the amount withdrawn, deducted from your redemption value.

Why it exists

Exit loads discourage short-term churning, which protects long-term investors from the costs that frequent trading imposes on the fund. Once you cross the holding period, the load drops to nil.

How to read a tiered load

Many equity funds use tiers, e.g. "2% if redeemed within 1 year, 1% within 2 years, Nil after 2 years." On Dhanik we condense this to 2% ≤1Y · 1% ≤2Y · Nil after 2Y — hover the ⓘ for the AMC's full wording.

• Liquid / overnight funds: usually no exit load (or a tiny graded load for the first few days).
• Equity funds: commonly 1% if redeemed within 1 year.
• ELSS: no exit load, but a 3-year lock-in instead.

Note: exit load is separate from capital-gains tax, which also depends on your holding period.

→ Every fund's exit load is summarised on its fund page.