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An analysis of SIP numbers reveals that long-term SIPs in direct plans—those with a tenure of more than five years—have grown faster than those in regular plans.
Data indicates that the industry witnessed a 63% growth in the number of SIP accounts with a tenure exceeding five years in FY25. These accounts rose from 17 lakh in FY24 to 27 lakh in FY25, reflecting an addition of over 10 lakh accounts.
Direct plan SIPs
|
SIP Duration |
No. of SIP accounts (Direct plans) in FY24 |
No. of SIP accounts (Direct plans) in FY25 |
Net addition |
Addition in % terms |
|
More than 5 years |
1652926 |
2687103 |
1034177 |
63% |
|
4 to 5 years |
1738836 |
2223496 |
484660 |
28% |
|
3 to 4 years |
2349861 |
3764203 |
1414342 |
60% |
|
2 to 3 years |
4943560 |
3535815 |
-1407745 |
-28% |
|
1 to 2 years |
5055057 |
6358318 |
1303261 |
26% |
|
Less than 1 years |
15298994 |
19569164 |
4270170 |
28% |
On the other hand, while regular plan investors are generally more inclined to invest for the long term, the growth in long-term SIP accounts in this segment was just 11%. The number of SIP accounts with a tenure of over five years in regular plans increased from 84 lakh in FY24 to 93 lakh in FY25, marking an addition of 8.8 lakh accounts.
Regular plan SIPs
|
SIP Duration |
No. of SIP accounts (Regular plans) in FY24 |
No. of SIP accounts (Regular plans) in FY25 |
Net addition |
Addition in % terms |
|
More than 5 years |
8371793 |
9251246 |
879453 |
11% |
|
4 to 5 years |
3141153 |
2811756 |
-329397 |
-10% |
|
3 to 4 years |
3010471 |
5577256 |
2566785 |
85% |
|
2 to 3 years |
7310128 |
7575699 |
265571 |
4% |
|
1 to 2 years |
9955814 |
12792982 |
2837168 |
28% |
|
Less than 1 years |
21142706 |
24391647 |
3248941 |
15% |
Clearly, while over 10 lakh SIP accounts were added to long-term SIPs in direct plans, the corresponding addition in regular plans was 8.8 lakh; it is evident that direct plan investors are beginning to show signs of maturity.
Suresh Soni, CEO of Baroda BNP Paribas Mutual Fund, believes that while the % growth in number of direct plan SIPs appears higher due to the low base effect, the investment ticket size remains much smaller. He explains, “In my view, while % growth in the direct channel may be higher on a small base, the MFD channel will continue to expand, as it adds significant value to clients' lives. Over the last decade, the share of MFDs has increased in distribution pie”
Swarup Anand Mohanty, Vice Chairman and CEO of Mirae Asset Mutual Fund, believes that many investors now prioritize chasing goals over simply seeking returns. He notes, “Whether it's a regular plan or a direct plan, one prominent trend among mutual fund investors is the belief that SIPs are meant for the long term. In fact, the industry conducts more business through staggered investments compared to lump sums.”
Mohanty also pointed out that the majority of young investors prefer the online route and are more likely to stay invested for long term as they believe in 'invest and forget' philosophy.
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