Growth of Mutual Funds in the Era of Recent Socio – Economic Advances in India

International Journal of Research and Scientific Innovation (IJRSI) | Volume V, Issue VII, July 2018 | ISSN 2321–2705

Growth of Mutual Funds in the Era of Recent Socio – Economic Advances in India

Mandakini Garg¹, Dr. Shobhit²

¹Assistant Professor, Pranveer Singh Institute of Technology, Kanpur, Uttar Pradesh, India
Ph.D scholar, Amity University, Lucknow, Uttar Pradesh, India
²Assistant Professor, Amity University, Lucknow, Uttar Pradesh, India

Abstract: – Mutual funds are the instruments used to mobilize savings into profitable investments. Since mutual funds accept small deposits, it is very feasible for the small investors to easily become the part of financial market. Mutual funds are linked to the financial market and give access to equity, debt and money market instruments. Since its beginning from 1963 to 2017, it has showed the remarkable rise in number of accounts as well as investment corpus. Mutual fund industry is experiencing the growth as AUM (Assets Under Management) have grown three and half fold in December 2017 more than in march 2012 i.e. 21.27 trillion in 2017 and 5.87 trillion in March 2012. Beginning from one player, now it is increased to 44 major players. Public, private and foreign financial undertakings are actively participating in expansion of mutual fund industry. Financial market suffered a major downfall in 2008 due to US meltdown which affected mutual funds industry. But, mutual funds gained its momentum from 2011-2012. After 2012, mutual fund industry has grown in huge numbers. Investors are influenced towards mutual funds as they can easily become the part of financial market and they are also disheartened by the sluggish growth of real estate, low return from gold and silver etc. As of Dec 31 2017, the number of folios in mutual funds stood at 55.4 million witnessing a growth of 15% CAGR over the last two years. The total number of accounts (SIP’s) has risen and reached to 6.65 crores in which retail contribution amounts to 5.46 crores. As investors inclination towards mutual funds is increasing so companies are even focusing more to promote the investment. Now a day, the investors have started using the digital mode for purchase and repurchase of mutual funds units. With the help of digitalization, investors feel very easy to operate in financial market. All the mutual funds companies initiated online approach for investors as investors can easily invest through the mobile apps as well as from their websites. Even KYC norms are to be strictly followed as they help the investors to invest easily in mutual funds as per their convenience.
This paper will highlight the growth of mutual funds in last ten years. It will also reflect the various reasons (macro economic factors) for the various fluctuations in mutual funds industry in last ten years.

Keywords: Systematic investment plan, Association of Mutual Fund Industry, Know Your Customer, Assets under Management

Read More