SEBI Chief: Mutual Funds Must Prioritize Investor Outcomes

Securities and Exchange Board of India (SEBI) Chairman Tuhin Kanta Pandey has called for the mutual fund industry to place investor outcomes at the core of its future growth strategy. He stressed that success should be measured by tangible benefits for investors, not solely by Assets Under Management (AUM) or the number of schemes launched.

Industry Growth Snapshot

The mutual fund sector has experienced substantial expansion in India.

Its AUM surged from approximately Rs 15 lakh crore in July 2016.

This figure is projected to reach about Rs 86 lakh crore by July 2026.

This growth reflects a robust compound annual growth rate of around 19 percent.

India currently has over 14 crore unique capital market investors.

More than 6 crore of these investors specifically engage with mutual funds.

Monthly systematic investment plan (SIP) contributions stood at approximately Rs 32,000 crore in July.

Pandey outlined an ambitious objective to double the number of mutual fund investors to roughly 12 crore over the next few years.

Strategies for Investor Expansion

To achieve this significant expansion, specific actions are recommended.

The industry must evaluate and strengthen its distribution networks.

Enhancing investor awareness is crucial through diverse initiatives.

These initiatives should be multilingual, multi-agency, and multi-media.

Pandey also highlighted the increasing involvement of women in the market, noting they now account for 34 percent of individual investor AUM.

Referencing the SEBI Investors Survey 2025, Pandey noted that 22 percent of Indian households expressed an intention to enter the capital markets within the subsequent 12 months.

These recommendations build upon previous SEBI reforms designed to streamline market regulation and reduce transaction costs. The aim is also to improve cost transparency, ultimately fostering greater investor participation across mutual funds, equity, and debt markets.