India’s mutual fund industry is projected to exceed Rs 300 trillion in assets under management (AUM) by 2035, driven by digital adoption, increased involvement from Gen Z, women, and smaller town households, and a shift towards long-term investing through SIPs, as per a recent report. The industry saw significant growth in 2025, with AUM reaching Rs 81 trillion in November, up from Rs 68 trillion in November 2024, marking an 18.69% year-on-year increase and nearly tripling over the past five years with a CAGR of 21.91%.
Factors such as sustained net inflows, robust market performance, and growing retail participation, supported by digitization and financialization of savings, have contributed to the consistent rise in AUM, according to a report by ICRA Analytics. By May 2025, the industry’s AUM had surpassed Rs 70 trillion, crossing the Rs 80 trillion mark within the next six months, despite global uncertainties.
Market experts believe that India is well-positioned to surpass the Rs 100 trillion mark in the coming years if the current inflow trends and market performance continue. Looking ahead, there is optimism for transformative growth beyond Rs 100 trillion, driven by the resilience of the domestic mutual fund industry and positive outlook on the Indian economy, stated Ashwini Kumar, Senior Vice President and Head Market Data at ICRA Analytics.
The AUM of open-ended equity funds quadrupled over a five-year period, increasing from Rs 9 trillion in November 2020 to Rs 36 trillion in November 2025. Flexi-cap funds exhibited strong year-on-year growth due to strategic flexibility, diversified exposure, and favorable market conditions, followed by multi-cap and large and mid-cap fund categories. Debt funds also saw a 14.82% year-on-year increase from Rs 17 trillion in November 2024 to Rs 19 trillion in November 2025.
In the equity fund performance segment, small-cap funds showed significant growth over 5- and 10-year periods, reporting a CAGR of 24.91% and 16.70%, respectively, as of November 30. Systematic Investment Plans (SIPs) have emerged as a key growth driver for the Indian mutual fund industry, with SIP AUM surpassing Rs 16.53 trillion by November 2025, constituting over 20% of the industry’s total AUM, underscoring their role in long-term asset accumulation.
