Why Are Small SIPs Shrinking While High-Value SIPs Grow — and What Should Your Monthly Amount Be?
Mutual Funds · SIP Data · India, FY 2025-26 and FY 2026-27
Why Are Small SIPs Shrinking While High-Value SIPs Grow — and What Should Your Monthly Amount Be?
Something reversed last year. After adding 2.02 crore SIP folios in FY 2023-24 and another 1.61 crore in FY 2024-25, India’s mutual fund industry ended FY 2025-26 with fewer SIP folios than it started with. The total slipped by 3.31 lakh to 9.88 crore. Headlines read it as retail investors walking away.
The data says something more specific and more useful. Exactly one ticket-size bracket shrank. Every bracket above Rs 1,000 grew. And the money going in each month did not fall at all — it hit fresh records. What actually changed is the composition of who is investing how much.
Quick Summary
SIP folios fell by 3.31 lakh, or 0.33 per cent, to 9.88 crore in FY 2025-26. The entire decline sits in the Rs 501 to Rs 1,000 bracket, which lost 13.86 lakh folios. Every bracket above Rs 1,000 grew, with SIPs above Rs 10,000 growing fastest at 5.95 per cent. Meanwhile monthly SIP money kept climbing: Rs 31,961 crore flowed in during July 2026, up 12 per cent year on year, and SIP assets reached Rs 18.2 lakh crore. This is a shift in mix, not an exit.
What the FY 2025-26 numbers actually show
SEBI’s ticket-size data, analysed by Cafemutual, breaks the SIP universe into six contribution brackets. Read across them and the story separates cleanly into two halves.
Note where the folios actually sit. The Rs 1,001 to Rs 3,000 bracket is the largest in the country at 3.35 crore folios, closely followed by Rs 501 to Rs 1,000 at 3.06 crore. India’s SIP base is genuinely mass-market, and the brackets that grew fastest are also the smallest by headcount.
The contrast with the previous year is what makes this notable rather than routine. The under Rs 500 bracket had grown 106 per cent in FY 2024-25 and managed 0.22 per cent in FY 2025-26. The Rs 1,001 to Rs 3,000 bracket had grown 19.09 per cent and slowed to 0.52 per cent. These are not gentle decelerations; they are the growth engine of the post-Covid retail boom stalling in a single year while the upper brackets carried on.
The number that gets misread
Two SEBI figures are circulating and they appear to contradict each other. One says SIP folios fell to 9.88 crore. The other, from SEBI’s annual report, says SIP accounts grew 3.9 per cent from 10.05 crore to 10.45 crore. Both are correct, because they count different things.
A folio is an investor’s account with a fund house. A SIP account is a single registered instalment mandate. One investor can hold several mandates inside one folio, or spread folios across several fund houses. AMFI publishes a third figure again — contributing accounts, meaning mandates that actually debited money in a given month, which stood at 9.90 crore in July 2026 against 10.63 crore registered.
Why the three counts diverge
The gap between registered and contributing accounts is roughly 73 lakh mandates as of July 2026. Some are between instalments, some have failed mandates, some are dormant but not cancelled. A folio-level count and a mandate-level count will therefore never match, and an April 2025 folio reconciliation exercise removed a large block of legacy dormant records, which is why year-on-year comparisons across that boundary need care.
Why the small SIPs stopped
No single cause explains the drop. Six forces were operating at once, and each one is visible somewhere in the data.
The direct-versus-regular gap is the most instructive line in the whole dataset. Direct plans lost more than twice as many long-tenure accounts in absolute terms despite starting from a much smaller base. Some of that is profit-booking and account consolidation. But a difference that wide suggests that having somebody to call during a drawdown changes behaviour.
Stopping is not the same as selling, and it costs more than it looks
A discontinued SIP does not redeem your existing units. It stops new ones from being bought — specifically, it stops them being bought at the lower prices a correction creates. Someone who paused a Rs 3,000 SIP for twelve months during a drawdown forfeits Rs 36,000 of contributions and the entire compounding period attached to them. Over a remaining 15-year horizon at an assumed 12 per cent, that gap is worth roughly Rs 1.97 lakh at maturity.
The money never fell, even in the year the accounts did
This is the part that gets lost. Folio counts fell while contributions set records. Monthly SIP inflows have stayed above Rs 30,000 crore for five consecutive months in 2026, and July’s Rs 31,961 crore was 12 per cent higher than a year earlier.
The stoppage ratio tells the same story from the other direction. It compares SIPs discontinued or matured against new registrations in a month. In July 2026, 61.44 lakh new SIPs were registered against 50.29 lakh closures, giving a ratio of 81.9 per cent, down from around 91 per cent in June and a third straight monthly improvement. Anything under 100 per cent means the base is still growing.
The Rs 250 experiment, and what it reveals
If small-ticket investing were genuinely dying, the Rs 250 Chhoti SIP would be the first casualty. It is not. SEBI introduced the scheme in February 2025 with subsidised onboarding, KYC and payment-gateway costs, available for an investor’s first three registrations across up to three fund houses. Registrations grew to 3.22 lakh by June 2026 from 1.97 lakh in April 2025, and assets almost doubled to Rs 184.2 crore in May 2026 from Rs 96.74 crore.
The scheme also carries the same problem in miniature. Since September 2025 monthly additions have averaged around 28,000 while closures averaged about 20,000, and more than 26,000 Chhoti SIPs closed in May 2026 alone. First-time investors, entering at the smallest ticket sizes, are the most sensitive to a bad quarter and to household budget pressure. That is the real finding hiding inside the FY 2025-26 numbers: the constraint is not the entry price, it is what happens in month fourteen.
SEBI’s own estimate was that a Rs 250 SIP breaks even for a fund house within two years, which explains why the industry cares about persistency rather than acquisition. An account that closes in month ten costs the fund house money and costs the investor the only thing that makes a SIP work, which is elapsed time.
What a monthly amount actually builds
The practical question behind all of this is not whether the industry is growing. It is whether your own number is the right one. The table below assumes a 12 per cent annualised return, which is an illustrative long-term equity assumption, not a promise. Actual returns depend on markets and can be materially lower or negative over any given period.
| Monthly SIP | 5 years | 10 years | 15 years | 20 years | 25 years |
|---|---|---|---|---|---|
| Rs 500 | Rs 0.41 lakh | Rs 1.16 lakh | Rs 2.52 lakh | Rs 5.00 lakh | Rs 9.49 lakh |
| Rs 1,000 | Rs 0.82 lakh | Rs 2.32 lakh | Rs 5.05 lakh | Rs 9.99 lakh | Rs 18.98 lakh |
| Rs 2,000 | Rs 1.65 lakh | Rs 4.65 lakh | Rs 10.09 lakh | Rs 19.98 lakh | Rs 37.95 lakh |
| Rs 3,000 | Rs 2.47 lakh | Rs 6.97 lakh | Rs 15.14 lakh | Rs 29.97 lakh | Rs 56.93 lakh |
| Rs 5,000 | Rs 4.12 lakh | Rs 11.62 lakh | Rs 25.23 lakh | Rs 49.96 lakh | Rs 94.88 lakh |
| Rs 10,000 | Rs 8.25 lakh | Rs 23.23 lakh | Rs 50.46 lakh | Rs 99.92 lakh | Rs 1.90 crore |
Worked example: the step-up, done with real arithmetic
Anita starts a Rs 5,000 monthly SIP at 30 and keeps it flat for 15 years. She invests Rs 9,00,000 and, at an assumed 12 per cent, ends with about Rs 25.2 lakh. Her colleague Devika starts at the same Rs 5,000 but raises it 10 per cent every year, so year two is Rs 5,500, year five is Rs 7,320, year fifteen is Rs 18,974. Devika invests Rs 19,06,350 across the same 15 years and ends with roughly Rs 43.4 lakh. She contributed 2.1 times as much and finished with 1.7 times the corpus. The step-up is not magic; it is simply the mechanism the SEBI bracket data is already capturing.
A framework for setting your own number
There is no universally correct SIP amount, but there are recognisable zones, and the action that makes sense differs sharply across them.
Start
Protect
Step up
Allocate
Structure
The single most consequential line in that rail is the third one. It holds 3.35 crore folios, more than any other bracket, and it is the point at which a stalled instalment starts costing real money. Someone contributing Rs 2,000 a month who has not raised it in six years is not investing the same amount they were; in inflation-adjusted terms they are investing meaningfully less, while their income has almost certainly risen.
What the bracket data captures, then, is two different behaviours that happen to look identical in a folio count. An investor who stops is a loss. An investor who moves from Rs 800 to Rs 2,500 also disappears from the lower bracket, but is a gain. The published numbers cannot separate them, which is why the contribution figures matter as much as the folio ones.
The step-up ladder
Decoder: the SIP terms behind the headlines
| Term | What it counts | Latest figure | Why it matters |
|---|---|---|---|
| SIP folio | Investor account with a fund house holding a SIP | 9.88 crore, FY 2025-26 | The measure that fell by 3.31 lakh |
| Registered SIP account | Individual instalment mandates on record | 10.63 crore, July 2026 | Includes mandates not currently debiting |
| Contributing account | Mandates that actually debited this month | 9.90 crore, July 2026 | The truest measure of active investing |
| SIP stoppage ratio | Closures divided by new registrations | 81.9%, July 2026 | Below 100% means the base is still growing |
| SIP AUM | Assets held through SIP routes | Rs 18.2 lakh crore | 21.2% of total industry assets |
| Step-up or top-up SIP | Automatic annual increase in instalment | Typically 5% to 15% a year | Converts income growth into corpus growth |
| Chhoti SIP | Rs 250 sachet SIP with subsidised costs | 3.22 lakh SIPs, June 2026 | Subsidy applies to the first three registrations |
| Ticket size | Monthly contribution per SIP | Six SEBI brackets | The variable that separates growth from decline |
What to do about your own SIP
- Check whether your mandate is live and funded. The gap between 10.63 crore registered and 9.90 crore contributing accounts is largely mechanical failure, not decision.
- Write down the goal each SIP is attached to, with a target amount and a year. A SIP without a goal is the first one you will stop.
- Set an annual step-up of at least 10 per cent, scheduled in the month your income normally changes.
- Use the table above to check whether your current amount can reach the target in the time you have. If it cannot, raise the amount or extend the horizon.
- Count your funds. Five SIPs into overlapping funds is one allocation with five statements.
- Review once a year against goals, not monthly against returns. Frequent checking during a drawdown is what precedes a stoppage.
- If you are considering stopping, first establish whether the reason is cash flow or market discomfort. Only the first is a real reason.
Habits that separate the SIPs that survive
Frequently asked questions
Why are small SIPs declining while high-value SIPs are growing?
SEBI data for FY 2025-26 shows the Rs 501 to Rs 1,000 bracket lost 13.86 lakh folios, a fall of 4.33 per cent, while every bracket above Rs 1,000 grew. Analysts attribute the drop to market volatility affecting rally-era entrants, higher churn among direct investors, consolidation of multiple small SIPs, and investors graduating to larger amounts as income rises.
Did the total number of SIPs in India actually fall in FY 2025-26?
SIP folios fell by 3.31 lakh, or 0.33 per cent, to 9.88 crore. But SEBI’s annual report separately shows SIP accounts rising 3.9 per cent from 10.05 crore to 10.45 crore. The two figures count different units, a folio versus an individual instalment mandate. The honest summary is that folio growth stalled while mandate numbers and money both kept rising.
Is Rs 500 a month too small a SIP to be worth starting?
At an assumed 12 per cent, Rs 500 a month for 25 years builds roughly Rs 9.49 lakh from Rs 1.50 lakh invested. The amount matters less at the start than the habit and the horizon do. SEBI’s Rs 250 Chhoti SIP framework exists precisely to lower this entry barrier, and had 3.22 lakh registrations by June 2026.
What is the SIP stoppage ratio and what does 81.9 per cent mean?
It compares SIPs discontinued or matured in a month against new SIPs registered. In July 2026, 50.29 lakh closures against 61.44 lakh registrations produced a ratio of 81.9 per cent, down from about 91 per cent in June. Any figure below 100 per cent means the SIP base grew that month. It says nothing about whether individual investors made good decisions.
Should I stop my SIP when the market falls?
A falling market is the period during which a fixed instalment buys the most units, which is the entire mechanism a SIP relies on. Pausing for genuine cash-flow reasons such as job loss is reasonable. Pausing because of a drawdown removes contributions from exactly the window that historically contributed most to long-term returns. Returns are not guaranteed in either case.
What is a step-up SIP and how much difference does it make?
A step-up or top-up SIP increases the instalment automatically each year by a set percentage. On a Rs 5,000 SIP over 15 years at an assumed 12 per cent, a flat contribution builds about Rs 25.2 lakh while a 10 per cent annual step-up builds about Rs 43.4 lakh. The step-up version requires Rs 19.06 lakh of contributions against Rs 9 lakh, so it is more money invested, not a free gain.
Why did direct-plan SIPs fall more than regular-plan SIPs?
Cafemutual’s analysis found direct SIP accounts older than five years fell 34.69 per cent to 17.55 lakh, while comparable regular-plan accounts fell only 4.41 per cent to 88.44 lakh. In absolute terms direct plans lost 9.32 lakh accounts from a smaller base against 4.08 lakh in regular plans. Profit booking and consolidation explain part of it; the rest suggests advised investors show greater persistency through volatility.
How much SIP money is flowing into Indian mutual funds each month?
Rs 31,961 crore in July 2026, up about 12 per cent from Rs 28,464 crore a year earlier, and the fifth consecutive month above Rs 30,000 crore. The all-time monthly peak was Rs 32,087 crore in March 2026. Total SIP collection for FY 2025-26 was Rs 3,49,589 crore, and SIP assets stood at Rs 18.2 lakh crore.
How many mutual fund folios have a SIP of Rs 3,000 or more?
More than 2.3 crore folios contributed Rs 3,000 or more monthly during FY 2025-26. Within that, 1.44 crore folios sit in the Rs 3,001 to Rs 5,000 band, 61.7 lakh in Rs 5,001 to Rs 10,000, and 29.60 lakh above Rs 10,000. The last of these grew fastest during the year at 5.95 per cent.
Does a declining SIP folio count mean Indians are losing faith in mutual funds?
The data does not support that reading on its own. Folio counts fell 0.33 per cent while monthly contributions hit records, SIP assets reached Rs 18.2 lakh crore and industry AUM grew to Rs 85.76 lakh crore. Some of the decline is genuine attrition among newer investors; some is investors moving up brackets or consolidating accounts. Composition changed more than commitment did.
The short version
SIP folios fell 3.31 lakh to 9.88 crore in FY 2025-26, the first decline after two years of double-digit growth. The whole of that decline sits in one bracket, Rs 501 to Rs 1,000, which lost 13.86 lakh folios. Everything above Rs 1,000 grew, and SIPs above Rs 10,000 grew fastest at 5.95 per cent. Money kept rising throughout: Rs 31,961 crore in July 2026, SIP assets at Rs 18.2 lakh crore. The actionable reading is not to start or stop, but to make sure your instalment moves with your income rather than staying frozen at whatever you could afford the year you began.
