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Mutual Fund Count Jumps on Policy Change, Growth Scope

Mint Ahmedabad

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August 11, 2025

Tax policy shifts, product innovation, untapped potential redrawing asset management map

- Srushti Vaidya

A mix of tax policy shifts, product innovation, and untapped potential is spurring a rush in India's mutual fund industry. However, not all are fresh entrants. Existing players in the ecosystem—portfolio managers, alternate investment funds (AIFs), stock brokers, and even investment bankers—are also now stepping in.

The number of mutual funds, which was stagnant for the last five years, saw a sharp rise to 53 as of 9 August. As per data from Securities and Exchange Board of India (Sebi), the number of fund houses hovered around 45 between FY19 and FY24.

Key factors include a change in short-term capital gains tax (STCG) bothering the portfolio management system (PMS) and AIF players, a new product launched by Sebi that gave benefit to mutual funds over PMS and AIFs, and shrinking revenues of brokers. An under-penetrated MF market also played a part.

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