Mutual fund AUM growth likely to stay above 20%, 3rd year in a row

Rise in debt, commodity ETF inflows offset lower lumpsum inflows into equity schemes

The mutual fund (MF) industry is likely to record over 20 per cent growth in assets under management (AUM) for the third consecutive year in 2025. The AUM, which stood at ₹66.9 trillion at the start of the year, had ballooned 21 per cent to ₹80.8 trillion by the end of November, according to data from the Association of Mutual Funds in India.

 

Assets managed by MF schemes had grown 27 per cent in 2023 and 32 per cent in 2024.

 

The strong growth persisted in 2025 despite the industry's key tailwind — the equity market — turning unfavourable this year. Markets saw a correction towards the end of 2024 and in early 2025, and are yet to decisively move past the highs touched in September 2024. The smallcap segment — which had seen the highest investor interest through MFs in 2023 and 2024 — ended the year in the red. 

“2025 was another strong year for the Indian MF industry, driven by transformation, inclusivity, and innovation. AUM of the industry has grown to ₹80.8 trillion, retail systematic investment plan (SIP) inflows crossed ₹29,000 crore, and the investor base grew at a strong pace, even as global headwinds and persistent selling by foreign institutional investors tested the equity market,” said D P Singh, deputy managing director and joint chief executive officer, SBI MF. 

The growth in AUM last year, unlike in most other high-growth years, was largely driven by inflows. As of November, total inflows into MF schemes in 2025 stood at ₹8.5 trillion, over 2 per cent higher than the all-time-high net inflows seen in 2024.

 

MF AUM growth depends on two factors — the quantum of inflows and outflows, and the change in the value of the underlying assets of the schemes.

 

Robust inflows in 2025 were supported by consistent SIP contributions and a surge in investments into debt funds and gold and silver schemes. Hybrid funds, especially multi-asset funds, also witnessed a rise in investor interest.

 

SIP inflows crossed ₹3 trillion for the first time in 2025, as investors increasingly relied on the staggered investment route amid market volatility. This came despite a decline in the number of active accounts.

 

Active accounts had seen a sharp drop in the first few months of the year due to the market correction and a one-time data cleanup exercise by fund houses.

 

MF schemes tracking gold and silver prices were among those garnering the highest inflows. Gold and silver exchange-traded funds together amassed over ₹50,000 crore until November.

 

Debt funds also saw a gush in inflows, largely due to increased institutional investment in liquid and other short-term schemes.

 

The jump in inflows into non-equity schemes more than offset the decline in lump sum inflows into equity schemes in 2025. As of October, while lump sum inflows into active equity schemes were ₹2 trillion lower than in 2024, SIP investments in active equity schemes were already 3 per cent higher at ₹2.3 trillion.