Small-Ticket SIP Accounts Fall By 1.4 Million In FY26 As Market Volatility Hits Retail Mutual Fund Investors
The number of small-ticket systematic investment plan (SIP) accounts in India declined in FY26, highlighting the impact of market volatility on first-time and lower-income mutual fund investors. According to a report by Business Standard, SIP accounts involving monthly contributions of up to ₹1,000 fell by 1.4 million during 2025-26, even as accounts with larger investment amounts continued to…
The figure of small-ticket systematic investment plan (SIP) accounts in India dropped by 1.4 million in FY26 due to market volatility affecting novice and lower-income mutual fund investors, according to a Business Standard report. Despite this decline, accounts with larger investment amounts continued to rise. The decrease follows robust growth in the segment, which expanded by 37% and 16% in the two preceding financial years, as per Securities and Exchange Board of India (Sebi) data.
Industry experts noted that many investors who joined mutual funds during the strong market rally of 2023 and 2024 were enticed by past returns. A substantial number invested via direct investment apps without professional guidance or distributor support. As markets grew more volatile, some investors might have found it challenging to remain invested, especially those with limited financial understanding and experience.
The Nifty 50 remains below its September 2024 peak, with smallcap and midcap stocks recently achieving new highs. Experts explained that investors making small monthly contributions often experience higher churn, with account openings surging during rallies and closures increasing during market corrections. Investments in larger SIP amounts persist in growth, although at a slower pace.
Accounts investing between ₹1,001 and ₹3,000 monthly rose 0.5% to 33.5 million in FY26. The ₹3,001-₹5,000 bracket expanded by 2.8% to 14.4 million, while SIPs between ₹5,001 and ₹10,000 grew by 5% to 6.2 million. Investments exceeding ₹10,000 increased by 5.9% to 3 million.
Experts believe the decline in smaller SIPs does not necessarily indicate investors are abandoning mutual funds. Some investors might be raising their monthly contributions as their incomes grow or consolidating multiple small SIPs into larger investments. Others may have ceased SIPs that were initiated without specific financial objectives during the market boom.
Written by urgent.news from Free Press Journal's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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