Monthly average gross SIP flows more than doubled in the last 3 years: Economic Survey

The mutual fund (MF) industry has grown well in the last few years and it is now crucial in channelling financial savings towards risk capital formation and leveraging technology and innovation, Economic Survey 2024-25, presented today, noted. "The MF segment presently has more than 10 crore Systematic Investment Plan (SIP) accounts, with cumulative SIP inflows of Rs 10.9 lakh crore since inception. Monthly average gross SIP flows have more than doubled in the last three years, from Rs 0.10 lakh crore in FY22 to Rs 0.23 lakh crore in FY25," it stated.

Aided by sustained inflows, the eco survey added that MF ownership in Indian listed companies has risen to a fresh all-time high of 9.5 per cent in the quarter ending September 2024, from 8.7 per cent in FY24.

It underscored that the rise in retail participation through MFs is reflected in the doubling of unique investors from 2.9 crore in FY21 to 5.6 crore as of December 2024.

"The total number of folios (excluding FoF domestic schemes) increased from 17.8 crore at the end of FY24 to 22.5 crore at the end of December 2024, and retail investors held MF units worth Rs 18.6 lakh crore. This surge in participation, coupled with strong market performance, has led to a remarkable increase in mutual funds' assets under management (AuM), which rose to Rs 66.9 lakh crore as of December 2024, registering 25.3 per cent growth from March 2024," the yearly financial review said.

It also mentioned that the period since the pandemic has seen a surge in individual and household participation as capital market investors through direct (trading in markets through their accounts) and indirect (through mutual funds) channels. "Healthy corporate earnings, stable macro fundamentals, efficient and robust technology architecture facilitating efficient trading, clearing, and depository systems, and trust garnered by mutual fund ecosystem and online digital investment platforms have encouraged greater participation in capital markets," the survey added.

It further highlighted the incremental addition to demat accounts has been continuously increasing, with the number of demat accounts rising sharply by 33 per cent to 18.5 crore at the end of December 2024 on a year-on-year (YoY) basis.