Topic 6: MUTUAL FUND

India’s mutual fund industry continued its strong growth trajectory in January 2026, even as equity markets turned volatile. Total industry assets under management (AUM) crossed a historic milestone, reaching ₹80.8 lakh crore, supported by 18.7% year-on-year growth. Equity AUM surged to ₹50.6 trillion, nearly doubling over the past two years, while systematic investment plan (SIP) assets rose to ₹16.5 lakh crore, accounting for about 20% of total AUM. Despite a marginal dip in monthly SIP inflows to ₹29,445 crore, industry projections continue to target ₹100 trillion in AUM in the near term and ₹300 trillion by FY35.
Alongside growth, regulatory oversight intensified. SEBI took decisive action against unregistered advisory activity, impounding ₹546 crore from a prominent finfluencer, reinforcing investor protection. The regulator also reduced mutual fund expense ratios and eased thresholds for duplicate security issuance, lowering costs and improving operational flexibility.
A major development was the notification of the SEBI (Mutual Funds) Regulations, 2026, replacing the 1996 framework. Key reforms include a revamped expense structure through a Base Expense Ratio, introduction of Mutual Fund Lite for passive products, and Specialised Investment Funds for higher-risk strategies. Stricter governance, enhanced disclosures, and stronger sponsor eligibility norms aim to improve transparency and accountability.
With most structural changes effective from April 1, 2026, the industry enters the next phase of growth with stronger safeguards and expanding investor participation.



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