Indian Mutual Fund and Equity Assets Projected to Grow Sixfold by FY2035: Report

India’s retail investment landscape is expected to undergo a substantial transformation over the next decade, with mutual fund and direct equity assets projected to expand more than 6-fold by FY2035.  

The How India Invests 2025 report by Bain & Company attributes this shift to broader investor participation beyond major metros, a younger demographic profile and increasing reliance on digital platforms. 

Surge in AUM and Retail Participation 

The report estimates that mutual fund assets under management could surpass ₹300 lakh crore by 2035, while direct equity holdings may rise to ₹250 lakh crore. This transition reflects a marked change in household financial behaviour, as families move from a predominantly savings-led mindset towards long term, market-linked investments.  

Mutual fund penetration is expected to double to 20% over the next 10 years, supported by rapid adoption in smaller centres. Cities outside the top 110 have lifted their share of AUM to 19% in FY25 from 10% in FY19, signalling a widening investor footprint across the country. 

Longer holding periods are also becoming more common. Mutual fund investments kept for more than 5 years have doubled to 16%, accompanied by a sustained rise in SIP tenures.  

Statements and Insights: Youth, Women and Digital Expansion 

As per report, the equity investor base is set for substantial growth, with an estimated nine crore additional retail investors likely to enter the markets by FY2035. Digital onboarding improved financial awareness and favourable market conditions are enabling this expansion.  

Investors under 30 now account for 40% of all NSE-registered participants, up from 23% in FY19, underscoring the growing influence of Gen Z and millennials. 

Participation from women continues to rise as well. Women now represent 25% of investors, compared to 20% in FY19, while mutual fund folios have increased nearly 2.5 times in 5 years. SIP inflows have grown at a 25% CAGR over the past decade, driven largely by individuals aged between 18 and 34.  

Digital channels remain central to this momentum, with around 80% of equity investors and 35% of mutual fund investors being onboarded digitally. Nearly half of all digital investment activity now originates from Tier 2 and smaller cities. 

Read More: 6 Key SEBI Mutual Fund Updates in 2025 Investors Must Note! 

Conclusion 

The findings indicate a major structural evolution in India’s investment ecosystem. With accelerating digital access, a younger investor base and wider participation beyond major metros, the next decade is expected to solidify India’s shift towards long term, market-linked financial behaviour. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.  

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.