Mutual funds step up: SIPs climb ticket ladder, one rung at a time

Investor count reaches the next landing, doubling in four years

The average ticket size for a systematic investment plan (SIP) is edging up, even as the pace of new account openings remains strong.

 

SIP ticket sizes had been shrinking in recent years, as mutual fund (MF) penetration grew. However, the average ticket size has started to climb again after a steep drop in the post-pandemic period, as the industry has doubled its investor base in the past four years.

 

Data from the Association of Mutual Funds in India shows that 99 million SIP accounts collectively invested an average of Rs 2,483 each in September 2024. In comparison, the amount was Rs 2,294 in March 2024 and Rs 2,250 in September 2023.

 

The average investment per SIP account was around Rs 3,000 before the pandemic. In December 2019, investors contributed an average of Rs 2,858 through their SIP accounts. 

 

Since then, SIPs have grown in popularity, with the number of accounts increasing from 29.8 million in December 2019 to nearly 100 million today. This sharp rise has been driven by a bull run in the equity market and a surge in new fund offerings.

 

SIP account additions have been particularly robust in the calendar year (CY) 2024. In the first nine months, MFs added 22.4 million accounts, compared to 15.1 million during the entire CY 2023.

 

The growing number of SIP accounts has also contributed to a steady rise in monthly SIP collections. SIP contributions, which totalled Rs 17,610 crore in December 2023, grew to Rs 24,509 crore in August 2024.

 

SIPs have become a major source of inflows for the MF industry, with equity fund inflows remaining positive for 43 consecutive months since March 2021, underpinned by continued interest in SIPs after the pandemic.