How India Fell in Love with Mutual Funds

A revolution in how the country thinks about money

It’s hard to watch a show or match these days without seeing at least one mutual fund ad. They’re everywhere - between overs, Youtube videos, and sometimes even between reels. While this kind of visibility isn’t entirely new, it’s definitely grown over the last few years, and signals that mutual funds have become part of the conversation in a way they weren’t before.

But for a long time, investing in India meant doing only what felt safe and familiar: gold was tradition, real estate was pride, and fixed deposits were reliable. These weren’t just financial choices though, they were habits shaped by years of doing things a certain way.

As for mutual funds, they didn’t quite fit into that picture yet. They were unfamiliar, not guaranteed, and felt a bit too closely tied to the stock market (which for most people meant risk and unpredictability).

But somewhere along the way, that perception began to change.

Mutual Funds in the 90s 🕰️

Mutual funds weren’t new - they’d been around since the 60s, when the Unit Trust of India (UTI) launched the country’s first fund. Come the 90s, a few more public and private sector players had entered the space.

The idea was simple: people pool their money, and a professional invests it for them. It was meant to make the stock market more accessible to regular individuals.

But even though mutual funds were available, they didn’t really catch on.

For most people, the whole thing felt unfamiliar. There was paperwork, the process was offline, and the idea of letting someone else invest their money in the market felt risky and distant from how people used to think about savings.

So mutual funds remained on the sidelines. Even though the access was right there, comfort was not (that came later).

What Changed and Why SIPs Made Sense 📆

Mutual funds didn’t take off because people suddenly fell in love with the stock market. What really changed was how they were presented, and nothing had an impact quite like SIPs…

A Systematic Investment Plan (or SIP) didn’t ask for a lump sum amount upfront or perfect timing. It worked with what people already understood: monthly saving. A fixed amount set aside every month that got invested automatically.

That simplicity and familiarity made all the difference. SIPs turned mutual funds from something abstract into something that felt doable.

While SIPs had technically been around for years, it wasn’t until the mid-2000s that they were actively promoted or adopted. By 2006, major fund houses began offering SIPs more widely, and over the next decade, they moved from being a lesser known choice to something many people started doing.

For first time investors, this offered a way to get started without having to be an expert or constantly track the market. More importantly though, SIPs encouraged patience (something most Indian households already practiced when it came to money).

The Role of Access and What Tech Changed 📱

What really helped mutual funds find their footing was better delivery, which came with the rise of digital platforms and simpler onboarding.

Platforms like Groww, Zerodha, and others removed a lot of the complexity. Long forms, physical paperwork, and middlemen began to fade and setting up an SIP became faster than opening a bank account.

Digital KYC, a one time ID verification using PAN and address proof, made the process quick and fully online. Combined with one click investing options (like tapping once to start or pause an SIP) and dashboards that were user friendly, what once felt confusing suddenly felt accessible.

This gave investors (especially first timers) a sense of control. They could compare funds, track performance, pause or edit SIPs, and explore options on their own terms.

Investing began to stop feeling like something reserved for experts and started to seem approachable, manageable, and even routine.

Content played a key role too. Platforms and creators began breaking down concepts into bite sized videos and explainers, often in regional languages, bridging the gap for people outside Tier 1 cities.

People now didn’t just have access to mutual funds, they also had access to the confidence to use them.

The Message Landed: “Mutual Funds Sahi Hai” 📢

If SIPs made mutual funds easier to use, this campaign made them easier to trust.

The “Mutual Funds Sahi Hai” campaign, launched by the Association of Mutual Funds in India (AMFI) in March 2017, didn’t make dramatic promises nor did it try to shock or dazzle anyone. There were no overnight success stories, just a simple message delivered in everyday language that mutual funds could actually make sense.

These ads felt familiar and resonated well with people: a father planning for his child’s education, a couple saving for their first home, a working professional trying to figure out what’s next.

The message was a calm and consistent reminder: invest regularly, stay in it for the long run, and don’t panic when the market dips.

Timing helped too. The ads appeared during cricket matches, TV soaps, and even radio shows - places where they could be heard exactly by the audience they were meant for. Over time, the tagline became more than marketing and became something people repeated, believed, and gradually even started acting on.

Celebrities (…and Credibility) ⭐️

As mutual funds became more mainstream, they began showing up in places that didn’t usually talk about investing - cricket match breaks, celebrity interviews, and even casual scrolls through social media, and this kind of reach truly had an impact.

When known public figures like actors, cricketers, and even relatable ad characters from popular ads started speaking about mutual funds, it didn’t turn them into flashy trends, it simply made them feel more normal.

Seeing familiar faces with voices that already felt trusted endorse the idea of planning for the future made the whole concept feel a little less distant and less intimidating.

Also, these weren’t high energy brand deals. The tone was calm, practical, and often quite personal. The message wasn’t “get rich,” it was “start small, think ahead.”

In a space where trust had always been the hardest part, this credibility made all the difference.

The Spread to Smaller Cities 🏘️

For years, investing was seen as something reserved for big cities and higher income groups - associated with English speaking professionals, urban lifestyles, and financial advisors. But slowly, that mindset began to change.

As digital platforms improved and communication became simpler, mutual funds begun finding their way into a much broader audience. SIP registrations from Tier 2 and Tier 3 cities started rising.

App based platforms and content in regional languages helped lower the barriers of language and access. People no longer needed to visit a bank branch or attend a workshop to start investing, a short video on the internet or a step by step walkthrough on an app was enough to get started.

What also helped though was the narrative. Mutual funds weren’t marketed as risky or high reward. They were presented as a way to start small, stay disciplined, and plan for the future - a message that echoed outside of urban India too.

This wasn’t just about the growth of a product, it reflected something deeper: that a growing number of Indians were starting to see investing as something that was not just possible but also smart.

What this Means for India 🇮🇳

Mutual funds didn’t take off in India because of one defining moment. This rise was gradual and built on better access, changing habits, and growing trust.

What once felt out of sync with daily habits became part of everyday financial planning - not because people changed overnight, but because the system began meeting them where they already were.

SIPs matched familiar saving patterns, digital platforms removed the paperwork and made things simpler, and campaigns like “Mutual Funds Sahi Hai” made the idea feel a lot less daunting.

This shift is evident in the numbers too: according to The Economic Times, SIP inflows hit a new peak of ₹27,269 crore in June 2025 - the first time they have ever crossed the ₹27,000 crore mark. Additionally, India now also has over 8.6 crore active SIP accounts, which speaks to both growing participation as well as the willingness to stick with it.

SIP inflows in June each year from FY 2016-17 to FY 2025-26; data sourced from AMFI

More than a financial milestone, this points to a significant change in how Indians think about and approach money - with growing confidence, curiosity, and the desire to do more than to simply save it.

Mutual funds may not be the final destination, but they’ve clearly become a natural and meaningful part of the journey.

Sources: AMFI, Invest India, Tradejini, Tata Capital, Investopedia, Kotak Securities, SEBI, The Economic Times.

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Next week: something fun coming up…a Front Man, 456 players, and a game where the real winner was Netflix! 🦑 Stay tuned 😉

Just a head’s up: I’m not an advisor or expert, just someone who’s curious, still learning, and trying to make sense of finance as I go. This isn’t financial advice - just good old thinking out loud.