Retail investor confidence in SIP continues as Mutual Funds surge 8% over 5 months, but Nifty down by over 10%

Despite continuous fall in Indian stock market, retail investors confidence in mutual funds continues with greater strength.

In the past five months contributions in Systematic Investment Plans (SIPs) have steadily increased in contrast to the broader stock market performance, with the Nifty 50 index witnessing a significant decline during the same period.

According to data from the Association of Mutual Funds in India (AMFi), SIP inflows reached a record Rs 26,400 crore in January 2025. This marks an around 8 per cent increase from Rs 24,509 crore in September 2024.

Over the years, SIP contributions have been consistently growing, with investments rising from Rs 11,517 crore in January 2022 to more than double in January 2025.

However, in contrast to this the Nifty 50 index has faced notable corrections. After hitting an all-time high of 26,277 in September 2024, the index has dropped by over 10 per cent to around 23,167 in January 2025.

Akhil Chaturvedi, Executive Director & Chief Business Officer, Motilal Oswal AMC said "Investor sentiment has been upright in a month when there has been heightened volatility and correction led by FII's selling pressure. We have seen stable net flows of 40k cr and a marginal decline in SIP block which currently stands at 26.4k cr against 26.45 k cr in December 2025. Interestingly, there is a swing in allocations from thematic funds to asset allocations funds like BAAF and MAF including large cap funds as a pure equity exposure".

The increase in SIP inflows is part of a broader trend of rising participation by retail investors in the Indian stock market. The assets under management (AUM) of the mutual fund industry grew by 0.5 per cent in January 2025 to Rs 67.3 lakh crore from Rs 66.9 lakh crore in December 2024.

Equity mutual fund AUM has also seen a substantial rise, growing from Rs 30.43 lakh crore in March 2024 to Rs 38.13 lakh crore in January 2025, reflecting a 25.3 per cent growth in the current financial year.

Even with short-term market fluctuations, this steady flow of investments indicates sustained confidence in the mutual fund industry and the Indian economy's long-term growth potential.