Positive economic sentiment and more market involvement contributed to the mutual fund industry's inflows through systematic investment plans, or SIPs, which reached a record Rs 2 lakh crore in 2023–2024, up 28% year over year.
Comparatively, according to statistics from the Association of Mutual Funds in India (AMFI), inflows of 1.56 lakh crore, Rs 1.24 lakh in 2021–22, and Rs 96,080 crore in 2020–2021 were recorded through this mechanism.
Furthermore, throughout the past seven years, the SIP contribution to mutual funds has increased by more than four times. In 2016–17, it was Rs 43,921 crore.
Furthermore, the SIP book has increased steadily, showing a 35 percent growth from Rs 14,276 crore in March 2023 to an all-time high of Rs 19,270 crore in March 2024. This year's SIP contributions, which topped Rs 19,000 crore for two consecutive months in February and March, indicate that investors are moving toward a more methodical approach to investing.
According to Karthick Jonagadla, Smallcase Manager and founder of Quantace Research, "this disciplined approach is further exemplified by the increased preference for equities, driven by their strong performance over the past year, indicative of investors conducting regular portfolio assessments and adjustments."
The CEO and Vice Chairman of Mirae Asset Investment Managers, Swarup Anand Mohanty, stated that the steady increase in SIP flows indicates a positive trend and that the company expects this momentum to help it reach its milestone of Rs 25,000 crore by the end of 2024.
The sustained trust that investors have in mutual funds is demonstrated by the SIP accounts, which reached a record high of 8.4 crore in March 2024.
Overtaking February's statistics of Rs 10.52 lakh crore, the SIP AUM reached at Rs 10.71 lakh crore. This demonstrates investors' steadfast dedication to prudent wealth growth, according to AMFI CEO Venkat Chalasani.
Investing in a chosen plan on a regular basis at predetermined intervals, such as once a month, is made possible by the notable SIP function provided by mutual funds. This is an alternative to making a lump sum investment. SIP payments start at just Rs. 500 a month.
Madhabi Puri Buch, the Chairman of Sebi, stated in December that the markets regulator is collaborating with mutual funds to enable the general people to make SIPs of Rs 250, which will increase investment.
While equities mutual funds experienced an inflow of Rs 1.84 lakh crore in FY24, the mutual fund sector mostly relied on SIPs for inflows.
The sector was able to raise its AUM by Rs 14 lakh crore, or a gain of 35%, to Rs 53.4 lakh crore in FY24 from Rs 39.42 lakh crore in FY23 because to the steady monthly rise in SIP flows.
