Har shaks bhaagta hai yahan bheed ki taraf,
phir ye bhi chahta hai ki usse raasta mile.
– Waseem Barelvi

Kaun seekhta hai sirf baton se,
Sabke liye ek hadsa zaroori hai.
– Jaun Elia

How we fight, tooth and nail, against gaining real insight. Against letting go of what makes us suffer.
– Helen Garner, How To End a Story – Collected Diaries.  

Rs 30,954 crore. 

In May 2026, that’s the total amount of money that was invested in mutual funds (MFs) through systematic investment plans (SIPs).

SIP is a complicated term which simply describes a way of regularly investing in an MF scheme. Most of this money is invested in equity MFs, which in turn, invest a bulk of the money collected in stocks listed on Indian stock exchanges.

In March 2026, Rs 32,087 crore was invested in MFs through SIPs – the highest ever.

In April 2026, Rs 31,115 crore was invested in MFs through SIPs – the second highest ever.

A total of Rs 94,156 crore has been invested in MFs through SIPs in the last three months. 

This is more than the money invested in MFs through SIPs in 2016-17, 2017-18 and 2018-19, respectively. What once took an entire year of SIP investments has now happened in three months.

And It’s pretty close to the money invested in 2019-20 and 2020-21, respectively.

Long story short – SIPs have become a very popular form of investing. In fact, they have become so big that they are now hurting the Indian economy and the average retail investor. And that’s what this piece is all about. 

My SIP story

On a very rainy day in September 2005, I was interviewed by a now defunct newspaper to write on personal finance. I had no idea about personal finance.

I was offered the job a few days later and I took it. With the benefit of hindsight, I can say, both sides were rather desperate.

In December 2005, I started my first two SIPs. One of them was in a scheme called SBI Magnum Tax Gain. I don’t remember the name of the other scheme.

A few months of writing and reading on personal finance convinced me that this was the best way to invest. 

With a daily job it was next to impossible to have the time to research stocks and invest in them. Plus SIPs were a disciplined way of investing – or so I thought. You kept investing a fixed amount month on month and hoped that it grew.

For more than 20 years now I have more or less stuck to SIPs. There have been periods when money has been tight – given that I work as a freelance writer – leading to no investments. And there was also a period when I briefly lost faith in SIPs.

When I first started investing in SIPs it was a novelty. MFs didn’t really advertise about it – at least nowhere as hard as they do now.

In fact, some of my male colleagues who were totally cued into the stock market’s daily ups and downs thought that SIPs were for sissies.

But given that I didn’t have to do much after choosing the schemes to invest in, I persevered. 

Mutual fund sahi hai

Now, equity MFs are not the only way of indirectly investing in stocks. There are Unit Linked Insurance Plans (ULIPs) too. ULIPs are basically MFs which come with a dash of life insurance.

In the 2000s and the early 2010s, insurance companies selling ULIPs offered a lot of upfront commission to those selling it. Hence, ULIPs were very popular – meaning mis-sold.

You walked into a bank wanting to do a fixed deposit and you were sold a ULIP. 

There were multiple problems with ULIPs.

First, a lot of the premium paid was simply used to pay commissions and not invested. 

Second, it was next to impossible to figure out which ULIP had given the best returns in the past.

Third, three years into the ULIP, agents and bankers selling ULIPs would appear again and try convincing you to ditch the current ULIP and buy a new one. It made sense for them simply because the ULIP commissions in the first two years were on the higher side. 

Fourth, insurance companies were allowed to use celebrities to advertise. MFs weren’t.

All this came together to make ULIPs a very popular form of mis-selling, and there weren’t enough agents, banks and wealth managers who wanted to sell MFs. And then things started to change.