The mutual fund industry in India has grown over six times in the last 10 years. Its assets under management (AUM) have jumped from Rs 10.83 lakh crore in March 2015 to Rs 69.5 lakh crore in April 2025, according to information available on the Association of Mutual Funds in India (AMFI) portal. This boom stems from changes in regulations, more investors joining in, and a wider reach into smaller towns. And that is just one in six decades of mutual funds in the country.
Here’s a summary of five main stages in the country’s mutual fund history, as described by industry body AMFI:
Origins: How UTI set the stage?
The origins of the industry go back to 1963, when the Unit Trust of India (UTI) was set up by an Act of Parliament at the initiative of the government and the Reserve Bank of India. Its first product, Unit Scheme 1964 (US ’64), created the framework for collective investment in securities. By the end of 1988, UTI’s assets under management stood at Rs 6,700 crore.
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Public sector enters the market
The second phase started in 1987 with the entry of public sector mutual funds launched by public sector banks, the Life Insurance Corporation of India (LIC), and the General Insurance Corporation of India (GIC). SBI Mutual Fund was the first non-UTI fund to be set up in June 1987. By the end of 1993, the industry’s total AUM had risen to Rs 47,004 crore.
Private sector and SEBI oversight
The arrival of private sector mutual funds in 1993 marked a turning point. Kothari Pioneer, which later merged with Franklin Templeton was the first private player. Around that time, the Securities and Exchange Board of India (SEBI) introduced its first set of regulations for mutual funds. A more comprehensive framework, the SEBI (Mutual Fund) Regulations, 1996 – continues to guide the industry today. By January 2003, there were 33 mutual funds managing assets worth Rs 1.21 lakh crore, with UTI alone handling more than Rs 44,500 crore.
Consolidation and challenges
The repeal of the UTI Act in 2003 split the trust into UTI Mutual Fund, regulated by SEBI, and the Specified Undertaking of UTI (SUUTI). But the global financial crisis of 2008-09 and SEBI’s abolition of entry loads dented investor confidence. Growth slowed between 2010 and 2013, and the industry went through a phase of consolidation with several mergers and acquisitions.
Revival and rapid growth
The industry has seen a strong comeback since 2014. AUM went past Rs 10 lakh crore in May 2014. It hit Rs 20 lakh crore in August 2017 and Rs 30 lakh crore in November 2020. In just the past five years, assets have more than tripled going from Rs 22.26 lakh crore in March 2020 to Rs 69.5 lakh crore in April 2025. During this time, investor accounts grew from 8.97 crore folios to 23.63 crore, with about 24 lakh new folios added each month on average.