Small-town investors power new wave in equity mutual fund inflows

Equity SIP inflows from B30 cross ₹10K cr, have 41% share in monthly flows

Systematic investment plan (SIP) inflows into active equity schemes from smaller towns have crossed ₹10,000 crore as their share in total SIP flows continues to rise despite volatility over the past year.

 

SIP inflows into active equity schemes from areas beyond the top 30 cities (B30), which first crossed this milestone in September 2025, stood at ₹10,080 crore in October, industry data shows. For comparison, SIP inflows from these towns were only ₹2,832 crore in March 2021.

 

While the inflows have grown in absolute terms, their share in total flows has also increased. They accounted for 41.4 per cent of active equity SIP inflows in October 2025, compared to 36.8 per cent in March 2021.

 

According to mutual fund (MF) executives and experts, the surging B30 share indicates growing investor comfort with equity and MFs. 

 

“The steady rise in SIP inflows from B30 locations signals more than just geographical expansion. It reflects a structural shift in how India saves and invests. For years, financial awareness and MF penetration were concentrated in the larger cities. But the past few years have seen a democratisation of investing powered by digital access, regulatory initiatives, simplified know-your-customer processes, and stronger on-ground investor education,” said Suranjana Borthakur, head of distribution and strategic alliances, Mirae Asset MF.

 

Smaller towns and rural areas have been a key focus for MFs in recent years as the industry works to deepen penetration. Multi-language awareness campaigns and B30-focused measures have delivered results, say experts, adding that the growing individual distributor base has also helped MFs expand their investor reach.

 

“This is mainly due to increasing penetration of distributors in smaller towns. Steps like micro SIPs of ₹250 or lower have also contributed. The massive multimedia campaign by the Association of Mutual Funds in India using celebrities like M S Dhoni and Sachin Tendulkar has helped MFs strike the right chord with investors,” said Sunil Subramaniam, founder and chief executive officer of Sense and Simplicity.

 

However, experts caution that B30 data is only indicative and does not offer a precise picture of investor participation from smaller towns. Since the classification is based on the address recorded in the permanent account number (PAN) database, many investors who have migrated to larger cities but not updated their PAN details continue to be counted as B30 investors.

 

In overall SIP inflows (including debt, passive, and hybrid funds), the B30 share is similar. In October, B30 locations contributed ₹12,130 crore to total SIP inflows of ₹29,529 crore. The B30 share stood at 41.1 per cent. The similar share indicates that investor interest is not limited to equity schemes — hybrid funds, passive funds, and even debt schemes are also witnessing a surge in B30 SIP flows.