With increased financialization of savings and rising per-capita income, the asset under management of the mutual fund industry is expected to touch ₹50 lakh crore in the next five years from the current level of ₹30 lakh crore.

Ashu Suyash, Managing Director, Crisil, at Crisil’s India Investment Research Conclave, predicted that the equity funds are expected to vanguard this growth trajectory, with their share expected to rise from 42% to 47%, in line with global peers. Passive funds will also emerge as a key driver registering a growth of 55% although on a smaller base while retirement solutions will also gain traction. The decision taken by SEBI to set aside a part of the management fee for industry development and allow more expense for attracting inflows from smaller towns was one of the reasons for robust growth in fund flow.

The past few decades have watched the mutual fund industry gaining currency and creating an edge for itself in the personal finance space and raise the share of Indian households in the overall savings pie. The future growth of the mutual fund industry looks promising, as the current unique client code base of 25 million has the potential to reach 250 million.