Mapping India's Mutual Fund Landscape: Insights from SIP Contributions and AUM

India’s growing middle class and rising financial awareness have driven a shift toward mutual fund investments, with SIPs emerging as a key tool for disciplined, long-term wealth creation. This study investigates the evolution of the Systematic Investment Plan (SIP) in India, analysing market dynamics and investor commitment from FY 2016-17 to March 2025. Data confirms SIP's role as a major stabilizing force in the capital market, demonstrating strong structural growth with a 26.57% CAGR and monthly inflows that nearly doubled to Rs 25,926 crore. Geographic analysis revealed a disparity: major cities (T30) concentrate high absolute capital, while smaller centres (B30) exhibit higher investment discipline, leading to a Concentration vs. Penetration Paradox. Crucially, investor behaviour has undergone a profound shift. The share of AUM held for over 5 years nearly tripled across both T30 and B30 segments between 2020 and 2025, driven by a sharp reduction in withdrawals made in the first year. This fundamental change proves that retail investors are successfully transitioning from beginner market participants to committed, long-term wealth creators. This research underscores the necessity of targeted strategies to sustain SIP's momentum and discipline nationwide, offering a clear roadmap for stakeholders to guide future product development and investor awareness programs.

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Publication Details

Journal
Asian Journal of Advanced Research and Reports
Published
2026-05-08
DOI
https://doi.org/10.9734/ajarr/2026/v20i51358
Primary Topic
Financial Markets and Investment Strategies
Type
article
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article

Mapping India's Mutual Fund Landscape: Insights from SIP Contributions and AUM

Manas Kumar Kushwaha
Asian Journal of Advanced Research and Reports
Financial Markets and Investment Strategies
article

Mapping India's Mutual Fund Landscape: Insights from SIP Contributions and AUM

Manas Kumar Kushwaha
article en

Abstract

India’s growing middle class and rising financial awareness have driven a shift toward mutual fund investments, with SIPs emerging as a key tool for disciplined, long-term wealth creation. This study investigates the evolution of the Systematic Investment Plan (SIP) in India, analysing market dynamics and investor commitment from FY 2016-17 to March 2025. Data confirms SIP's role as a major stabilizing force in the capital market, demonstrating strong structural growth with a 26.57% CAGR and monthly inflows that nearly doubled to Rs 25,926 crore. Geographic analysis revealed a disparity: major cities (T30) concentrate high absolute capital, while smaller centres (B30) exhibit higher investment discipline, leading to a Concentration vs. Penetration Paradox. Crucially, investor behaviour has undergone a profound shift. The share of AUM held for over 5 years nearly tripled across both T30 and B30 segments between 2020 and 2025, driven by a sharp reduction in withdrawals made in the first year. This fundamental change proves that retail investors are successfully transitioning from beginner market participants to committed, long-term wealth creators. This research underscores the necessity of targeted strategies to sustain SIP's momentum and discipline nationwide, offering a clear roadmap for stakeholders to guide future product development and investor awareness programs.

Asian Journal of Advanced Research and ReportsVol. 20(5)
Decent work and economic growth
Openalex Percentile: Top 4%
Financial Markets and Investment Strategies
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