Glossary term
Exit load
A small fee charged for redeeming mutual fund units within a short holding period — usually 1% if redeemed within 1 year.
Exit load is a fee — typically 1% — charged when you sell mutual fund units before a stated holding period (often 365 days). It's deducted from the redemption amount and goes back into the fund's assets.
Liquid funds and most debt funds have no exit load. ELSS funds have a mandatory 3-year lock-in instead. Always check the exit load before redeeming; selling on day 364 vs day 366 can mean a 1% penalty.