The Indian mutual fund industry is witnessing a remarkable transformation. In the quarter ending June 2025, the sector experienced record-breaking growth in Systematic Investment Plan (SIP) registrations, highlighting the rising preference of retail investors for systematic and disciplined investing despite the challenges posed by market volatility. According to data released by the Association of Mutual Funds in India (AMFI), a total of 1.67 crore new SIP accounts were added in just three months, marking a sharp rise from 1.41 crore new registrations in the previous quarter. This surge has been interpreted as a clear indication that Indian households are increasingly shifting away from traditional savings instruments and are embracing market-linked wealth creation strategies.
1. Groww Emerges as the Market Leader
Among distributors, Groww stood out as the undisputed leader, accounting for nearly 42 lakh new SIP accounts, which translates into a 25 per cent market share during the quarter.
- In June 2025 alone, Groww added 15.7 lakh SIP accounts, making it the single highest monthly addition by any distributor in India.
- In terms of value, SIPs registered on Groww’s platform during the quarter amounted to ₹1,116 crore, which represented an impressive 32 per cent growth compared to the previous quarter.
This dominance underlines the growing role of digital-first investment platforms, which have been able to capture the younger generation of investors through user-friendly interfaces, low account opening barriers, educational tools, and transparent fee structures.
2. Other Key Contributors
While Groww led the pack, other distributors also reported strong performance:
- Angel One emerged as the second-largest contributor, adding 15 lakh SIPs in the June 2025 quarter.
- NJ IndiaInvest, a well-established traditional distributor, registered 5.9 lakh new SIPs.
- SBI Securities and HDFC Securities recorded 4.3 lakh and 3.8 lakh new SIPs, respectively.
- PhonePe, another digital-first fintech player, added around 5.9 lakh SIPs. However, most of these were concentrated in low-ticket size investments, indicating a large participation base but relatively smaller contributions per investor.
This mixed distribution of growth between fintech-driven distributors and traditional brokerage houses reflects the hybrid nature of India’s mutual fund market, where both digital convenience and established trust networks are playing crucial roles.
3. Resilience Despite Market Volatility
The growth in SIP registrations came at a time when equity markets remained volatile. The benchmark Nifty 50 index delivered mid-single-digit returns year-to-date, reflecting uncertainty caused by both domestic and global macroeconomic conditions.
Despite this volatility, retail investors did not shy away from investing. Instead, they continued to add fresh SIPs, showcasing a maturing investor mindset that is less reactive to short-term market fluctuations and more focused on long-term wealth creation.
This behavioral shift is considered one of the strongest indicators of financial maturity in Indian households, as earlier trends often showed retail investors pulling out of equities during turbulent times.
4. Record SIP Inflows and Assets Under Management (AUM)
The surge in registrations translated into record inflows into mutual funds via SIPs:
- In June 2025 alone, total SIP inflows touched ₹27,269 crore, marking the highest monthly contribution ever.
- SIP Assets Under Management (AUM) climbed to ₹15.3 lakh crore as of June 30, 2025, compared with ₹12.4 lakh crore a year earlier, representing a growth of nearly 23 per cent year-on-year.
The increase in SIP AUM highlights the power of consistent retail contributions. Even though individual ticket sizes may remain relatively small, the cumulative impact of millions of disciplined investors has significantly strengthened the mutual fund industry’s foundation.
5. Investor Demographics and Rising Financial Inclusion
The number of unique mutual fund investors in India reached 5.4 crore in 2025, a remarkable 20 per cent increase from 4.5 crore in 2024, and a 42 per cent jump from 3.8 crore in 2023.
This growth reflects:
- The increasing adoption of mutual funds in tier-2 and tier-3 cities, enabled by digital platforms.
- The willingness of first-time investors, particularly younger professionals, to start small SIPs as low as ₹500 or ₹1,000 per month.
- Enhanced financial literacy campaigns by AMFI and Asset Management Companies (AMCs) that highlight the benefits of systematic investing.
The demographic shift indicates that mutual fund penetration is no longer restricted to urban elites but is becoming a mass financial product embraced across income categories.
6. The Role of Digital Platforms
The rise of fintech-driven distribution platforms such as Groww, PhonePe, and Paytm Money has transformed mutual fund investing in India. Their role in the June 2025 quarter was particularly noteworthy because:
- They simplify onboarding, requiring minimal paperwork and offering app-based KYC verification.
- They democratize investing by allowing micro-SIPs with small denominations.
- They provide easy access to financial data, portfolio tracking, and educational resources.
- They attract millennials and Gen Z investors, who prefer seamless mobile-first solutions over traditional brokers.
Industry analysts suggest that digital-first platforms will continue to dominate SIP growth in the coming years, though traditional distributors will still retain relevance for investors who seek advisory-driven relationships.
7. Investor Education and Trust Building
One of the less visible but highly impactful drivers behind this surge is the continued effort of AMFI and AMCs in spreading financial awareness. Through campaigns like “Mutual Funds Sahi Hai,” investors are being educated about:
- The importance of long-term investing.
- The benefits of rupee cost averaging in SIPs.
- The power of compounding and how even small SIPs can create significant wealth over decades.
- The fact that SIPs help mitigate market volatility by investing systematically over time.
This awareness has strengthened trust in the mutual fund ecosystem, encouraging new investors to stay committed.
8. Total Industry AUM Reaches Record High
The mutual fund industry’s overall Assets Under Management (AUM) rose to ₹74.4 lakh crore in June 2025, marking an 18 per cent increase compared with ₹63.2 lakh crore in the previous quarter.
This record high in AUM was supported by:
- Continuous SIP inflows.
- Growing institutional participation.
- A steady expansion of equity-linked schemes, balanced funds, and passive index funds.
The AUM growth reaffirms mutual funds’ role as one of the most critical pillars of India’s financial system and capital markets.
9. Why SIPs Are Becoming Popular
The popularity of SIPs stems from multiple advantages that align well with the needs of Indian investors:
- Affordability: Investors can start with as little as ₹500 per month.
- Discipline: Encourages consistent investing habits.
- Rupee Cost Averaging: Mitigates risks of timing the market.
- Flexibility: Investors can increase, decrease, or pause SIPs anytime.
- Compounding Benefits: Long-term SIPs create exponential wealth.
- Convenience: Automated monthly deductions make investing hassle-free.
These features have made SIPs a preferred route for salaried individuals, young professionals, and first-time investors.
10. Expert Opinions and Market Outlook
According to market experts and financial advisors:
- Retail investors are increasingly viewing mutual funds not as speculative tools but as vehicles for disciplined wealth creation.
- SIP inflows are expected to remain resilient, even if short-term volatility persists in equity markets.
- With India’s GDP growth projections remaining strong, coupled with rising disposable incomes, mutual funds are likely to attract a broader investor base.
- The penetration of SIPs could expand significantly in semi-urban and rural regions in the next 5 years, powered by digital accessibility and financial inclusion initiatives.
Analysts believe that if the current momentum sustains, India could see SIP inflows crossing ₹30,000 crore per month by 2026, making SIPs a cornerstone of domestic financial stability.
11. Challenges Ahead
While the growth trajectory is impressive, some challenges remain:
- Investor Retention: Ensuring that new investors stay invested during market downturns.
- Low Ticket Size Investments: Although digital platforms add volumes, many accounts contribute small sums, which may not significantly deepen capital formation unless ticket sizes increase.
- Financial Literacy Gaps: While awareness is improving, many investors still lack knowledge about fund categories, risks, and taxation.
- Regulatory Oversight: With rapid growth in digital platforms, SEBI must ensure transparency, compliance, and investor protection.
Addressing these challenges will be crucial to sustain long-term confidence in the industry.
12. The Bigger Picture: India’s Investment Evolution
The rapid rise in SIPs is not just a statistical milestone — it represents a broader economic and cultural transformation:
- Shift from Savings to Investments: Indians have traditionally relied on gold, real estate, and bank deposits. The surge in SIPs signals a generational change toward financial market participation.
- Wealth Democratization: Unlike earlier eras when stock market investing was limited to affluent classes, mutual funds and SIPs allow ordinary households to participate in India’s economic growth story.
- Support for Capital Markets: Regular inflows via SIPs provide liquidity and stability to Indian stock markets, reducing reliance on foreign portfolio investors (FPIs).
In short, SIPs are becoming the backbone of India’s retail investment culture.
Conclusion
The June 2025 quarter will be remembered as a landmark phase in India’s mutual fund journey. With 1.67 crore new SIP registrations, record inflows of ₹27,269 crore, and AUM hitting ₹74.4 lakh crore, the industry has demonstrated its resilience and ability to attract retail investors even in uncertain times.
Platforms like Groww, which added nearly 42 lakh SIPs, are shaping the future of financial inclusion by making investing accessible to all. At the same time, traditional distributors continue to play an important role in advisory-led investing.
As India’s investor base grows — from 3.8 crore in 2023 to 5.4 crore in 2025 — mutual funds are no longer niche products but mainstream vehicles of household wealth creation. Backed by digital innovation, strong investor education, and rising trust, the mutual fund industry is poised for even greater milestones in the years ahead.
