The modest growth came on the back of strong inflows into Gold Exchange Traded Funds (ETFs) and continued investor interest in equity schemes, even as debt funds faced large redemptions.
Gold ETFs emerged as the standout category in September, attracting all-time high inflows of ₹8,363 crore — a 578% jump from the same month last year and the highest-ever monthly inflow for the segment.
Their AUM surged 24% month-on-month to ₹90,136 crore, more than doubling on a yearly basis.
Rising gold prices, expectations of rate cuts by the U.S. Federal Reserve, a weaker rupee, and geopolitical uncertainty spurred the rush toward gold-backed investments.
Equity mutual funds also maintained momentum, drawing net inflows of ₹30,422 crore during the month, led by value, focused, and large & midcap funds. Equity AUM rose 1.8% to ₹33.68 lakh crore, supported by sustained investor participation through Systematic Investment Plans (SIPs).
SIP contributions reached a new all-time high of ₹29,361 crore in September, reflecting a 4% rise over August. The steady increase highlights growing retail participation and financial discipline, aided by greater digital adoption and awareness around long-term investing.
In contrast, debt-oriented mutual funds recorded significant outflows of ₹1.02 lakh crore, driven largely by withdrawals from liquid funds (₹66,042 crore) as corporates and institutions met quarter-end liquidity needs and festive expenses. Other short-duration categories also saw redemptions, though overnight and dynamic bond funds managed modest inflows.
Hybrid schemes experienced softer inflows of ₹9,397 crore, down 39% from the previous month, while passive funds — primarily ETFs — attracted ₹19,057 crore in net inflows.
Despite the drag from debt funds, ICRA Analytics said the overall AUM growth underscored resilience in the mutual fund industry, supported by robust retail participation and increasing preference for diversified and passive investment options.