SIP Surge: Monthly Inflows Set to Hit Rs 40,000 Crore Milestone in Two Years

The mutual fund industry is poised for a significant boost, with monthly Systematic Investment Plan (SIP) inflows expected to rise to Rs 40,000 crore within the next 18 to 24 months. This optimistic projection comes from Madhu Nair, CEO of Union Asset Management Company (AMC), who attributes the anticipated growth to rising disposable incomes and increasing awareness about disciplined investing.

 

Currently, SIP inflows stand at Rs 25,925 crore as of March 2025. Despite a short-term dip caused by market volatility, the broader outlook remains positive. The average monthly SIP contribution in FY25 rose to Rs 24,113 crore, a substantial increase from Rs 16,602 crore in the previous fiscal year. This growth reflects the maturity of retail investors who recognize the long-term benefits of systematic investing.

 

Key Highlights:

1. The introduction of a more investor-friendly tax regime, effective April 1, 2025, exempts individuals earning up to Rs 12 lakh annually from income tax, boosting disposable income.

2. SIP assets under management (AUM) grew to Rs 13.31 lakh crore in March 2025, up from Rs 10.71 lakh crore in the previous year.

3. Equity mutual funds saw inflows of Rs 4.17 lakh crore in FY25, significantly higher than Rs 1.84 lakh crore in FY24.

4. Union Mutual Fund has upgraded Indian equity markets to the "attractive zone," reflecting improved valuations and strong domestic fundamentals.

 

Union AMC has also launched a new campaign, "Badhna Hai Toh Lagey Raho, SIP Karo," encouraging investors to stay disciplined and focused on long-term goals despite market noise. This initiative underscores the industry's commitment to fostering financial literacy and promoting systematic investing as a reliable wealth-building tool.

 

Sources: Economic Times, The Hindu BusinessLine, Rediff Business.