SIP Stoppage Ratio Hits Record High in March 2025: Over 51 Lakh SIPs Discontinued

The SIP (Systematic Investment Plan) stoppage ratio measures the number of SIP accounts discontinued in a given period compared to those newly registered. A higher ratio indicates that more investors are halting their investments than initiating new ones. In March 2025, this ratio soared to 127.5%, meaning that for every 100 new SIP accounts opened, around 127 were closed.

March Records the Highest SIP Stoppage Ratio Yet

According to data released by the Association of Mutual Funds in India (AMFI), approximately 51 lakh SIPs were discontinued in March 2025, while only 40 lakh new SIPs were registered. This marks the 3rd consecutive month where the number of discontinued SIPs exceeded new ones.

In comparison:

• February 2025 had a stoppage ratio of 122%

• January 2025 saw a ratio of 109%

This sustained upward trend signals an emerging concern within the mutual fund industry.

Possible Factors Behind the Rising Stoppage Ratio

While the AMFI data does not specify the reasons behind this trend, several potential factors could be at play:

• Profit booking by investors after the recent market rally

• Increased market volatility or uncertainty

• Completion of SIP tenures

• Investors pausing or withdrawing amid changing financial goals or liquidity concerns

Regardless of the reasons, the fact remains that a significant number of investors are stepping back from their systematic mutual fund investments.

SIP Inflows Dip Marginally in March

Despite the growing number of discontinuations, SIP inflows remained relatively stable. In March 2025, mutual fund SIP inflows stood at ₹25,926 crore, slightly lower than ₹25,999 crore in February — a marginal dip of 0.28%.

Fewer New SIP Registrations

There was also a notable drop in new SIP registrations, which stood at 40.18 lakh in March compared to 44.56 lakh in February. This reduction, coupled with higher stoppages, paints a cautious picture of investor sentiment.

Contribution Base and AUM Data

• The number of contributing SIP accounts declined to 8.11 crore in March from 8.26 crore in February.

• Despite this, Assets Under Management (AUM) through SIPs rose to ₹13.35 lakh crore, up from ₹12.37 lakh crore in February, reflecting the broader market performance and valuation appreciation.

Growth in Mutual Fund Folios Continues

Interestingly, while SIP trends showed signs of stress, mutual fund folio growth remained positive:

• Total mutual fund folios: 23.45 crore in March vs 23.22 crore in February

• Retail folios (equity + hybrid + solution-oriented): 18.58 crore in March vs 18.42 crore in February

This indicates that investors may be reallocating or reshaping their portfolios rather than exiting mutual fund investments altogether.

Conclusion

The record-high SIP stoppage ratio in March 2025 underscores a shift in investor behaviour that warrants close observation. Whether this trend continues or reverses will depend on future market conditions, investor confidence, and broader economic indicators.

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