Mutual Funds Still Trail Gold and Real Estate, Big Plans To Boost The Sector

In terms of absolute growth, the country’s mutual fund industry has grown at a scorching pace. Its AUM has grown from Rs 21 lakh crore in 2017 to Rs 72 lakh crore in 2025, monthly SIP from Rs 4,000 crore to Rs 26,600 crore and investor’s count has grown five times — from 1 crore to 5 crore. Yet, the investor’s numbers is poor given the size of the population. This poor investor number indicates low awareness and thereby poor penetration level. Though the industry’s Sahi Hai campaign has transformed the space from a high-net-worth niche to a retail-driven engine, more needs to be done. At the 17th ICC Mutual Fund Summit, regulator SEBI has urged the industry to use digital tools for wider access. To help the MF industry, SEBI has undertaken a comprehensive review of the sector’s regulations to ease business operations and introduce flexible scheme design, and recategorize schemes. SEBI feels that innovation and strong governance must go hand in hand, and any missteps would invite regulatory action. Interestingly, AMFI has positioned financial well-being — not just access—as the next frontier. However, AMFI lamented the fact that even though 33% of household disposable income is saved, 66% goes into gold and real estate and only 34% into financial assets. And mutual funds form a small portion of this, though their share of bank deposit equivalents has risen from 10% to 32%. India’s AUM-to-GDP ratio stands at 20%, compared to 65% globally and over 100% in developed markets. To deepen penetration, AMFI is expanding financial literacy drives in various states. Despite 80% general literacy, financial literacy remains at only 27%. This is the gap AMFI aims to close.