Last Updated:
Investment Trends- The surge in AUM of the mutual fund industry is linked to the three-fold increase in the domestic stock market benchmark index Nifty 50. This has driven away millions of investors from low return bank deposits.
New Delhi. Bharti Bank deposits were once considered the ‘safest’ investment option. Bank deposits have been attracting investors for a long time due to fixed interest, stable returns and zero risk. But now its attraction is fading. The mood of the people is now changing and retail investors are entering the fast lane of the capital market in search of higher returns. The figures of the last five years are witness to this. By 2025, in just five years the Assets Under Management (AUM) of mutual funds will increase by almost three and a half times to reach Rs 80 lakh crore. During this period, bank deposits increased from Rs 136 lakh crore to Rs 226 lakh crore. Last October it increased to Rs 242 lakh crore.
While in 2019, the AUM of mutual funds was only 19% of bank deposits, in 2025 this share has reached 32%. In the financial year 2019-20, about 86% of the total investment money was deposited in banks. This share was 89.5% in the financial year 2022-23. But by October 2025 this share will reduce to 75.2%. During the same period, mutual funds increased their stake almost five-fold from 2.5% to more than 13%. That means, along with the traditional treasury of the bank, the confidence of investors in the market is also increasing rapidly. This is not just a figure, but an indication of a big revolution going on in the ideology of investment in India.
FY Bank Deposit MF AUM
2019-20 135.67 22.26
2020-21 151.13 31.42
2021-22 164.65 37.56
2022-23 180.43 39.42
2023-24 204.75 53.4
2024-25 225.8 65.47
October 25 241.75 79.87
The returns are tempting
The biggest reason for this change is the unprecedented performance of the domestic stock market. The surge in AUM of the mutual fund industry is linked to the three-fold increase in the domestic stock market benchmark index Nifty 50. This has driven away millions of investors from low return bank deposits. Nifty was at 8,598 in March 2020, which increased three times to 25,722 in October this year.
At the same time, during the last five years, the average interest rates on FD of banks have been increasing and decreasing. It was 5.44% in March 2020, which increased to 6.72% by March 2025. It decreased to 5.6% in September 2025.
