Daily SIP will become an even bigger 'rage' than Rs 250 SIP, says SBI MF's DP Singh

DP Singh

One of India’s largest mutual funds in terms of assets under management, SBI MF’s Joint CEO DP Singh said the fund house is very excited about daily SIPs - introduced last year - even more than the recently introduced Rs 250 SIP scheme.

"We are doing it very responsibly (Rs 250 SIP). Through the initiative we are trying to extend capital creation to the mid-market and bottom-of-the-pyramid investors. Rs 250 is just symbolic. When you look at the number of demat accounts and mutual fund investors, the potential is far greater. We are confident we can scale this. This is just the beginning," Singh said while speaking at the Moneycontrol Global Wealth Summit 2025 in Mumbai on March 7.

"Daily SIP will become a rage in the coming times," he said.

SBI MF’s joint CEO said SBI Mutual Fund is aiming to encourage more investors to take part in the daily SIP plan through direct investments and DIY route. On the recently introduced Rs 250 SIP, SBI MF said it doesn’t want to distribute the scheme through distributor channels as the economics will not work out.

While presenting the Union Budget 2025 on February 1, Finance Minister Nirmala Sitharaman had announced that annual earning of up to Rs 12 lakh will attract no income tax. Singh believes this is set to make a lot more number of people in the Tier II and Tier III cities -who are just trading in cash - enter the capital market through small and affordable SIP schemes.

SBI Mutual Fund had launched the 'JanNivesh SIP' scheme on February 17, offering micro systematic investment plans (SIPs) starting Rs 250. At the launch, former SEBI Chairperson Madhabi Puri Buch had said that a Rs 250 SIP was ‘one of my fondest dreams’.

"This is really what we are talking about—an India where wealth is created and distributed among all, no matter how small the amount. JanNivesh is a vision of an inclusive Bharat," Madhabi Puri had said at the launch.

On thematic funds, DP Singh said, "In a bull run, there are themes where there are enough stocks, which are working... As a responsible player we are careful."

He added that there has been a discussion on thematic funds with market regulator Sebi about setting limits and said that the industry has taken a proactive approach. "There have already been significant reductions in the number of thematic funds, even before the market corrections," he said. Thematic funds have suffered a significant impact on returns in recent market fluctuation, and some market experts have advised new investors to exercise caution before investing in them.

"Whenever a mutual fund comes out with a thematic fund, they are investing on behalf of investors after thorough research. While there have been instances of funds being launched purely to collect capital, responsible and credible players do not engage in such practices," DP Singh added.

Looking ahead, Singh stressed the need for investor education as market dynamics evolve. "We need to educate investors in a proper manner. While the number of SIPs may have declined, the overall SIP value has remained steady (as a result of the education)," he said.