Mutual Fund Industry in India - Market Size, Major Players, Current Condition

Mutual Fund Industry in India - Market Size, Major Players, Current Condition

Nowadays, people are working for future prosperity, where something you have earned in the present will reflect as a beget in the future; that too something huge in return.

Have you heard of Mutual funds, where a pool of money is collected from many investors to be funded in securities, bonds and other money market instruments? A Mutual fund plays as an investment as well as a company. Mutual funds works, where you as an investor buy a unit of share of a part of the mutual fund say as, portfolio’s value. Therefore, technically, the investor buys partial ownership of the company and its assets.

If the funded amount showed positive returns which highly depends on the securities the investors decided to buy, then the investors receive profit, while in the case of deprivation in the return; vice-versa. The investor of mutual funds earns their returns in three different ways such as- dividends, Capital gain and a hike on the mutual fund’s scheme.

Classification of Mutual Funds Industry in India
Market Size of Mutual Fund Industry in India
Recent changes by SEBI in the Mutual Fund Industry in India
Major Players in the Mutual Fund Industry in India
Current Condition of the Mutual Fund Industry in India

Classification of Mutual Funds Industry in India

Equity Funds:

Most prevalent mutual fund schemes in India where investors participate in stock markets in the long run because the return in those markets is comparable high to others.

Sector-specific fund

These mutual funds have high risk in terms of high potential return, where the investors fund their money in specific sector segments such as mining, banking, infrastructure etc.

Index funds

Index mutual funds are a medium risk factor, to those who don’t want any fund manager to manage their returns.

Tax saving funds

These funds are a tax deduction, where these investments have a 3 year lock-in period that plays as tax benefits to the investors.

Debt Funds

These ilk of mutual funds are credit risk, which has a low-risk appetite as well as low outcome. Debt funds are suitable for those investors who are coveting steady income from the fixed investment such as Government bonds or debentures.

Money Market Funds

Investors who are seeking reasonable returns in the investment over a short period of time can enroll into money market funds. Moreover, it has a low-risk factor where the return comes in liquid form so it will be a reasonable return on investments.

Hybrid Funds

It is similar to Balanced funds, despite the proportion of equity assets being juxtaposed to balanced funds. This kind of mutual fund is highly recommended to retired or geriatric who expect low risks.

Balanced Funds

Balanced mutual funds divide the investment between equity and debt mutual funds, where moderate returns with comparatively low risk vary according to the market risks.

Open-ended funds:

Here, the investor can enter, redeem or exit at any point in time because an open-ended mutual fund doesn’t have any fixed maturity period

Close-ended funds

Close-ended funds have a fixed maturity date, so the investors can only enter into the market during the initial period of any mutual funds scheme known as the new fund offer; Furthermore, their investment can be redeemed only when the maturity period expires.

Gilt funds

These mutual funds invest only in Government securities, which has no credit risk associated with their investment but has a high interest risk rate.

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Market Size of Mutual Fund Industry in India

Mutual fund value as a part of individual wealth in financial assets
Mutual fund value as a part of individual wealth in financial assets

The mutual fund industry in India was established back in the year 1963 at the launch of Unit Trust of India by the Government of India. The first very step to the millennials happened in 1964, where UTI introduced the first mutual fund scheme in India and public sector enterprises likewise SBI, Punjab National Bank, Indian Bank, and Bank of Baroda entered the scheme, which was worth 6,700 Crores at the end of 1988.

After a great heyday in India regarding mutual funds, the industry colluded to open a portal for the private sector and by 1993 onwards India has burgeoned in the Mutual fund Industry.

According to the statistics, it is reported that the Indian mutual fund industry had assets under management of 31.43 trillion as of March 2021 which resulted in a jump of 41% in fiscal 2021.

Recent changes by SEBI in the Mutual Fund Industry in India

In June 2021, some amendments were made to SEBI regulation 1996, where they should comply with those new rules of the mutual funds’ stated by 1st September 2021. The mutual fund is required to share details of risk, performance, outcomes, portfolio to investors only for the scheme they have invested in.

Major Players in the Mutual Fund Industry in India

The money invested in the mutual funds is managed and the schemes are operated as per the regulations of mutual funds by entities registered under the companies act for this specific purpose and they are known as Asset Management Companies. The major AMC offering services in India 2021 are:

  • SBI Mutual Fund
  • HDFC Mutual Fund
  • ICICI Prudential Mutual Fund
  • Reliance Mutual Fund
  • Aditya Birla Sun Life Mutual Fund

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Current Condition of the Mutual Fund Industry in India

The Mutual Fund Industry’s Assets Under Management (AUM) saw a rise of 41 per cent in FY 2021. As of 30th June 2021, the AUM was valued at INR 33.67 trillion. In fiscal 2021, the biggest attraction was the corporate bond funds with net inflows of INR 3,299 crore. The highest net outflows of INR 28.923 crore were seen in credit risk funds.


Indian People are big fans of Cricket and the players too. And these cricketers are big fans of Mutual Funds or it seems as they say “mutual funds SAHI HAI!”. The mutual fund industry is rapidly growing and the SAHI HAI campaign that was launched in 2017 has contributed a lot to this growth as people are aware of mutual funds and results in investor education.

The first quarter of FY 21-22 added 12 lakh investors to the fast-growing mutual fund industry in India. As more people learn about the benefits and security provided by mutual funds, the industry is expected to see favorable growth in the coming years.


What is the mutual fund industry?

Mutual Fund Industry are the companies that pool money from various investors and invests the money in securities like stocks, bonds and short term debt. A portfolio is the combined holdings of the mutual fund of the company.

What is the total revenue of the Mutual Fund Industry in India?

As of 30 June 2021, the AUM (Assets Under Management) of the Indian mutual fund industry is around INR 33.67 trillion. The AUM of the Indian Mutual fund Industry as of 30 June 2016 was INR 13.81 trillion. The industry has seen a two-fold increase in the span of 5 years.

Who is governing and regulating the mutual fund industry in India?

Mutual funds are primarily regulated by the Securities and Exchange Board of India (SEBI). The approval of the Reserve Bank of India (RBI) on a mutual fund is required to provide a guaranteed returns scheme. The Ministry of Finance of India acts as the supervisor of the RBI and SEBI. The mutual funds are regulated by SEBI, RBI, the Companies Act, Indian Trust Act, Stock exchange and the ministry of finance.  

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