Flexi-cap, small-cap and mid-cap funds emerged as the top preferred categories, reflecting investor diversification across market segments. Experts said the trend highlights growing investor discipline and a long-term approach towards wealth creation.

India’s mutual fund (MF) industry continued to witness strong retail participation in May 2026, with equity mutual funds attracting net inflows for the 63rd consecutive month and systematic investment plan (SIP) contributions remaining above the Rs 30,000 crore mark despite market volatility.

According to data released by the Association of Mutual Funds in India (AMFI), the mutual fund industry’s net assets under management (AUM) stood at Rs 81.58 lakh crore in May 2026, marginally lower than Rs 81.92 lakh crore recorded in April. However, investor participation remained robust, with the industry adding 12.56 lakh net folios during the month, taking the total folio count to 27.66 crore.

Equity mutual funds recorded net inflows of Rs 22,907 crore in May, extending the industry’s uninterrupted streak of positive equity inflows that began in March 2021.

SIP inflows remain key growth driver

SIP inflows remained a key growth driver, contributing Rs 30,953.83 crore during the month. SIP assets rose to Rs 17.12 lakh crore, accounting for nearly 21 per cent of the industry’s total AUM, while the number of contributing SIP accounts stood at 9.64 crore.

Commenting on the trends, Feroze Azeez, Joint CEO of Anand Rathi Wealth, said the latest data reflects the growing maturity and resilience of Indian investors.

“May 2026 AMFI data continues to show the strength of India’s equity participation story as actively managed equity funds saw net inflows of Rs 22,908 crore during the month, while active equity AUM crossed Rs 36.13 lakh crore,” Azeez said.

He noted that retail investors have continued investing systematically despite fluctuations in the market.

“What stands out more is the resilience of retail investors as SIP contributions remained above the Rs 30,000 crore mark at Rs 30,897 crore. Despite market volatility, SIP inflows in May 2026 were nearly 16 per cent higher than the same period last year. This clearly shows that Indian investors are becoming more disciplined and are looking at equities as a long-term wealth creation opportunity,” he added.

Flexi-cap, small-cap and mid-cap funds lead inflows

Within equity schemes, flexi-cap funds emerged as the preferred category with net inflows of Rs 5,176 crore, followed by small-cap funds at Rs 4,946 crore and mid-cap funds at Rs 4,385 crore. Together, these categories accounted for more than Rs 14,500 crore, nearly two-thirds of total equity inflows during the month.

Azeez said the trend indicates that investors are diversifying investments across categories and market capitalisations rather than concentrating on a single segment.

Meanwhile, Gold ETFs recorded net outflows of Rs 725 crore in May after witnessing positive inflows for 12 consecutive months. According to Azeez, investors may be booking profits after the sharp rally in gold prices and reallocating capital towards equity markets, which have seen corrections in recent months.

AMFI highlights long-term investment focus

AMFI Chief Executive Venkat Chalasani said the industry’s growth continues to be supported by robust SIP inflows and India’s strong economic fundamentals, while emphasising the importance of staying committed to long-term financial goals.

Chalasani noted, “With India’s strong economic fundamentals, our focus remains empowering investors with the knowledge to stay committed to their long-term financial goals.”

Published on June 10, 2026