Mutual funds add 81 lakh investor accounts in FY21

THE NUMBER OF FOLIOS WITH 43 FUND HOUSES ROSE TO 9,78,65,529 AT THE END OF MARCH 2021

NEW DELHI: The mutual fund industry added more than 81 lakh investor accounts in 2020-21, taking the total tally to 9.78 crore, and experts hope that the healthy growth in folios would continue in the ongoing fiscal also.

The industry had added 72.89 lakh investor accounts in 2019-20, according to data from the Association of Mutual Funds in India (Amfi).

Investors are increasingly acknowledging the importance of making investments in mutual funds for meeting financial goals both long term and short term, Kaustubh Belapurkar, director manager research, Morningstar India said.

“The awareness about investing in mutual funds has been on the rise over the last many years with the investor awareness programmes, ground work done by mutual funds, financial advisors and distributors in educating and shepherding investors through their investing journey,” he added.

Folios are numbers designated to individual investor accounts. An investor can have multiple folios.

According to the data, the number of folios with 43 fund houses rose to 9,78,65,529 at the end of March 2021 from 8,97,46,051 in March 2020, registering a gain of 81.19 lakh folios. wthe mutual fund space saw an addition of 1.13 crore investors account in 2018-19, 1.6 crore accounts in 2017-18, over 67 lakh folios in 2016-17 and 59 lakh in 2015-16.

Prateek Mehta, co-founder and chief business officer of Scripbox, said there are a number of reason owing to the folios growth, and some of the significant ones are due to the surge in digitisation driven by proliferation of technology, financialisation of savings and ease of transactions.

In addition, there is a clear migration from real estate and gold to financial products. Improved offerings and larger distribution networks have also accelerated adoption, he added.

Investor account in equity oriented schemes surged by 24.3 lakh to 6.68 crore at the end of past fiscal from 6.44 crore in March 2020. Besides, debt-oriented scheme folios count rose by 16.16 lakh to 88.4 lakh.

Within the debt category, liquid funds continued to top the chart in terms of number of folios at 22.3 lakh, followed by low duration fund at 12.26 lakh and corporate bond at 7.13 lakh.

The mutual fund industry had assets under management (AUM) of ₹31.43 lakh crore at the end of March compared to ₹22.26 lakh crore in March 2020. “We expect the healthy growth in folios to continue in the coming years as newer investors continue to start their investing journey by investing in Mutual funds,” Morningstar India’s Belapurkar said.