SIPs showed strong revival in May with ₹26,688 crore inflows and 8.56 crore active accounts
In May 2025, mutual fund investors witnessed a noticeable improvement in the Systematic Investment Plan (SIP) stoppage ratio. The stoppage ratio measures how many SIPs were stopped or completed compared to how many new ones started. In May, the ratio fell to 72.12%, a big improvement from the alarming 297.74% recorded in April 2025. This also compares well with May 2024, when the ratio was around 88.38%.
A stoppage ratio below 100% means more new SIPs are starting than ending, showing that investor confidence might be returning. This ratio is often used as a quick way to understand whether investors are continuing their investments or pulling out.
SIP Inflows and Mutual Fund Growth in May 2025
The mutual fund industry showed several positive signs in May:
New SIP accounts opened: ₹59.15 lakh
SIPs stopped or completed: ₹42.66 lakh
Total money invested through SIPs (SIP inflows): ₹26,688 crore — this is the highest monthly inflow ever recorded.
Total SIP Assets Under Management (AUM): ₹14.61 lakh crore, rising from ₹13.89 lakh crore in April.
Total mutual fund AUM (including SIPs and lumpsum investments): ₹72.19 lakh crore.
Total active SIP accounts (folios): 905.57 lakh. Out of these, 856 lakh folios were actively contributing money.
All these numbers suggest that people are still investing strongly through SIPs despite earlier concerns.
Why Was April’s Stoppage Ratio So High
April 2025 saw a massive stoppage ratio of almost 300%. This spike was not entirely due to investors losing confidence, but mostly because of a clean-up drive done by SEBI (the regulator) and AMFI (the mutual fund association).
During this drive:
Dormant SIP accounts that had been inactive for months were identified and removed.
Around 1.43 crore unused SIP folios were cleaned up.
These inactive accounts were no longer contributing, so they were officially marked as stopped.
This clean-up made April’s stoppage ratio look extremely high. However, now that this process is complete, May’s stoppage ratio offers a clearer picture of investor behavior.
What the 72% Stoppage Ratio Means
While 72% is still higher than the ideal levels seen during very strong growth periods (usually 45–60%), it is a clear improvement compared to both April 2025 and May 2024.
A stoppage ratio below 100% shows that more SIPs are being started than stopped.
A ratio of 72% means that while some investors are stopping their SIPs, most continue to stay invested or are starting new SIPs.
Industry experts believe the ratio will likely return to the healthier range of 45–60% in the coming months if market conditions remain stable.
Why Investors Are Still Choosing SIPs
Even though the stoppage ratio was high earlier, several factors continue to support SIP growth:
Record High SIP Inflows
The amount invested in May reached ₹26,688 crore, setting a new record. This shows that despite some people stopping their SIPs, the total amount invested through SIPs continues to grow.
Growing Share of SIPs in Total Mutual Fund Assets
SIP assets now account for more than 20% of the total mutual fund industry’s assets, showing that SIPs remain a popular choice among investors.
More Active SIP Accounts
The number of active SIP folios increased to 8.56 crore in May, up from 8.38 crore in April. This reflects that many new investors are joining the SIP route even as some old accounts are closed.
Industry Growth Continues
Even after removing inactive SIP accounts, the mutual fund industry continues to grow. Total mutual fund folios crossed 23.83 crore, showing strong participation from retail investors.
What to Expect in the Future
Now that the one-time clean-up is complete, mutual fund experts expect the stoppage ratio to stabilize further in the coming months. The following trends may shape the future of SIPs:
Stable and Lower Stoppage Ratios
With dormant accounts cleaned out, the ratio may soon return to the 45–60% range, which was common during periods of steady growth in previous years.
Consistent Inflows Expected
SIP investments may continue to attract long-term investors, especially as more people become aware of the benefits of systematic investing.
Market Volatility Will Still Play a Role
Even though SIP inflows remain strong, market ups and downs can influence investor behavior. A sharp fall in markets might discourage some investors, while a steady market may encourage continued investments.
What This Means for Mutual Fund Investors
A lower stoppage ratio means that people are regaining confidence in mutual funds.
Consistency is key for SIP investors. Those who continue their SIPs during both good and bad market phases often benefit the most over the long term.
Watching not just the total number of SIPs but also how many are actively contributing is important.
Regulatory changes, tax policies, and global events may still influence SIP trends in the future.
Bigger Trends Behind SIP Growth
The 0.21% month-on-month rise in SIP flows shows steady growth.
The total mutual fund industry’s assets have now crossed ₹70 lakh crore, reflecting deepening market participation.
Retail investors are actively joining both equity and hybrid funds through SIPs.
The rising share of SIP assets in total mutual fund AUM shows that systematic investing is becoming more popular than lump-sum investing.
Is the Shine Back on SIPs
The recent data suggests that SIP investments remain strong. The drop in the stoppage ratio to 72% after the April spike shows that the earlier high figure was mainly due to regulatory clean-up and not because investors lost faith.
Today, mutual fund investors continue to pour in record amounts into SIPs, the total assets under management are growing, and the number of active SIP accounts is at an all-time high. As long as markets remain stable and investor education continues, SIPs are likely to remain one of the most trusted ways for individuals to grow their wealth in the long term.
