The mutual fund industry is anticipating a significant increase in monthly Systematic Investment Plan (SIP) inflows over the next 18-24 months, driven by rising disposable incomes and growing awareness about disciplined investing. This projection is based on Madhu Nair, CEO of Union Asset Management Company (AMC), who expects SIP inflows to reach ₹40,000 crore. According to Nair, the industry has witnessed a declining trend in SIP inflows over the past four months due to heightened market volatility triggered by frequent US tariff changes. However, the overall picture remains optimistic, with SIP accounts increasing from 8.4 crore in March 2024 to 8.11 crore in March 2025. SIPs remain a popular investment option among retail investors, offering a disciplined approach to investing. This allows individuals to invest small amounts at regular intervals in mutual fund schemes, reducing the burden of lump-sum investments and mitigating market volatility over time.
- Start with as little as ₹250
- Invest at regular intervals
- Benefit from long-term growth
The mutual fund industry majorly depends on SIPs for inflows. Equity mutual funds saw a significant increase in inflows, with ₹4.17 lakh crore invested in FY25, compared to ₹1.84 lakh crore in FY24. This substantial increase can be attributed to improved investor sentiment driven by robust corporate earnings, favourable macroeconomic conditions, and a continued shift towards equity as a preferred asset class. The regular monthly increase in SIP flows facilitated the industry to grow its Assets Under Management (AUM) by 23 per cent to ₹65.74 lakh crore in March 2025, up from ₹53.40 lakh crore in March 2024.
| Month | AUM (in ₹ crores) |
|---|---|
| March 2024 | 53.40 |
| March 2025 | 65.74 |
The improvement in investor sentiment has led to Union AMC’s decision to upgrade Indian equity markets to the “attractive zone” in its fair value spectrum indicator. This is a notable shift from the “fair” and “moderately expensive” zones where the markets lingered for most of 2024. To encourage investors to remain disciplined and goal-focused, Union AMC has launched its latest SIP campaign, ‘Badhna Hai Toh Lagey Raho, SIP Karo’. The campaign stresses the importance of staying invested in the long run, citing the human tendency to overestimate short-term impact and underestimate long-term potential. Looking ahead, Nair shared the company’s plans for 2025-26, which include expanding into Specialized Investment Funds (SIF), Alternative Investment Funds (AIFs), and establishing a presence in GIFT City. These moves signal Union AMC’s intention to grow beyond its traditional mutual fund offerings and tap into broader investment opportunities. The industry is optimistic about the future, driven by the growing maturity of retail investors and the introduction of a more investor-friendly tax regime. With improved market valuations, individuals are expected to drive higher household savings into long-term investments such as SIPs. As Nair said, “It’s human nature to overestimate short-term impact and underestimate long-term potential. We believe in the long-term promise of the Indian economy and equity markets over the next 10 to 15 years.” Union AMC’s commitment to long-term growth
The mutual fund industry is expected to continue its growth trajectory, driven by the increasing popularity of SIPs and the growing awareness of disciplined investing. As the industry moves forward, it is essential to maintain a long-term perspective and stay invested, despite market noise and volatility. In conclusion, the mutual fund industry is optimistic about the future, driven by the growing maturity of retail investors and the introduction of a more investor-friendly tax regime. With improved market valuations and a continued shift towards equity, the industry is poised for further growth and expansion. A brighter future for SIPs
The benefits of SIPs are numerous, and they offer a disciplined approach to investing that can help individuals achieve their long-term financial goals. With the right mindset and a well-planned strategy, SIPs can be a powerful tool for building wealth and securing a brighter financial future.
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