Common Man Bets Big On India Despite Trump's Tariffs, Mutual Funds Witness Rs 1.79 Lakh Crore Inflow In July, SIPs Hit All-Time High

The Indian mutual fund industry recorded unprecedented inflows in July 2025, with net investments surging 264% month-on-month to Rs 1.79 lakh crore, according to data from ICRA Analytics. The jump reflected a mix of rising investor confidence, strong equity market performance, and broader retail participation.

Equity mutual funds led the rally, registering net inflows of Rs 42,702 crore — an 81% increase from June. Demand was particularly strong for large-cap, mid-cap, small-cap, and flexi-cap schemes, as investors sought higher returns in a buoyant market. Sectoral and thematic funds also attracted record interest.

Debt-oriented schemes saw inflows of over Rs 1.07 lakh crore, driven largely by money market and liquid funds. Analysts said expectations of liquidity easing, including the impact of a 100 basis points CRR cut, supported investor appetite for shorter-duration debt products.

Also Read: Can These Mutual Fund Schemes Yield 20% Return In Next 3 Years? | Republic World

Hybrid funds delivered mixed results, with dynamic asset allocation and multi-asset categories attracting investors, while arbitrage funds witnessed outflows. Meanwhile, passive funds and exchange-traded funds continued to expand their investor base.

The industry launched 30 new fund offers during the month, raising Rs 30,416 crore. Overall assets under management (AUM) climbed 1.28% from June, reaching Rs 75.36 lakh crore by the end of July.

Systematic Investment Plans (SIPs) also touched a fresh peak. Monthly SIP contributions hit Rs 28,464 crore, while the number of active SIP accounts rose to 9.45 crore. Industry experts attributed the growth to rising financial awareness, digital adoption, and steady returns from equities, which have made SIPs the preferred route for long-term wealth creation among retail and first-time investors.

ICRA Analytics noted that July’s performance underscored both the maturity of India’s mutual fund ecosystem and the deepening participation from smaller cities, supported by easier access to digital investing platforms.

What makes the surge particularly notable is that it comes at a time of external headwinds. Despite US President Donald Trump imposing fresh tariffs on Indian products, which has created uncertainty in segments of trade and exports, domestic investors have continued to channel record sums into mutual funds — underscoring the resilience of India’s savings cycle and the growing preference for financial assets over traditional ones.