Investments in mutual funds through direct plan SIPs has been growing gradually. An age-wise analysis of SIP accounts shows that direct plan SIPs account for 11% of the total SIP AUM.
AMFI data shows that of the total SIP AUM of Rs.2.81 lakh crore, Rs.29,700 crore has come from direct plan SIPs.
Further, if we delve deeper into the data, the contribution of direct plan SIPs to the overall SIP AUM of the MF industry has increased to 14% for SIPs being held for less than a year. Direct plan SIPs was just 5% of the total SIP AUM if we look at SIPs assets which are in the industry for five years and more.
Here is the table on age-wise SIP accounts of direct plan SIP AUM
|
SIP accounts continuation period |
Direct AUM (in crore) |
Total AUM |
Direct AUM proportion |
|
Over 5 years |
2,779.79 |
51,025.85 |
5% |
|
4-5 years |
1,337.22 |
14,751.37 |
9% |
|
3-4 years |
2,211.80 |
23,052.14 |
10% |
|
2-3 years |
4,269.30 |
41,872.22 |
10% |
|
1-2 years |
7,684.06 |
66,432.88 |
12% |
|
Less than 1 year |
11,386.11 |
83,784.60 |
14% |
|
Total |
29,668.28 |
2,80,919.06 |
11% |
Experts attribute this to growing awareness about direct plans through AMFI campaign and ease of investment through apps like Zerodha, ET Money and Paytm Money.
Suresh Sadgopan, Founder of Ladder7 Financial Advisories said that the emergence of mobile apps such as Zerodha, Paytm Money and ET Money in the past couple of years has made the direct plan more accessible for investors. “There are investors who want to do a monthly SIP of as low as Rs.500. For advisors, it may not be possible to advise such investors, but these apps have made the MF industry accessible to them,” he said.
Mukesh P Karla, CEO, ETMONEY, said that the rise in direct plan SIPs is due to a combination of factors. One, the growth of online as a medium to invest has been rapid. Second, the awareness about direct plans when the user is online has increased significantly in the past couple of years. Thirdly, direct plans were always available without any charge on mutual fund websites. With the wave of online platforms aggregating these plans on one place, it has made investing in direct plans easier for users.
Meanwhile, the regular plan SIPs still contribute a major portion i.e. 89% to the total SIP AUM. However, the contribution of regular plan SIP in the total SIP AUM has decreased from 95% to 86% if we look at the data of the past five years and more.
|
SIP accounts continuation period |
Regular AUM |
Total AUM |
Regular AUM proportion |
|
Over 5 years |
48,246.06 |
51,025.85 |
95% |
|
4-5 years |
13,414.15 |
14,751.37 |
91% |
|
3-4 years |
20,840.34 |
23,052.14 |
90% |
|
2-3 years |
37,602.92 |
41,872.22 |
90% |
|
1-2 years |
58,748.82 |
66,432.88 |
88% |
|
Less than 1 year |
72,398.49 |
83,784.60 |
86% |
|
Total |
2,51,250.78 |
2,80,919.06 |
89% |
