Tier-II and III cities, jointly referred to as B30 locations, are on the rise as the growth motor of the Indian investment fund industry, according to a recent report released by cams on the 18th Mutual Fund Summit in the hands of the Confederation of Indian industry (CII). From January 2025, B30 cities accounted for 56 percent of all new SIP registrations, an increase of 49 percent in FY23, which marked a composite annual growth rate (CAGR) of 64 percent.
Equity Assets in Management (AUM) in B30 cities have also kept pace with those in T30 metro’s, with a CAGR of 46 percent in the same period. This has enabled B30 cities to maintain a share of 26 percent of the total equity of the investment fund industry.
The report, entitled “B30 Locations – Performance & Potential”, is based on data from Cams Mfdex, which includes approximately 98 percent of the AUM of the investment fund industry. The report indicates that the B30 investor base is now around 2 crore, accounting for 58 percent of the total first-class investor base that is maintained by Cams.
On the report, Rishi Kumar Bagla, chairman, CII Western Region,: “The report is proof of the success of the efforts of the legal vision and cooperation industry. It is encouraging to witness Bharat who invests confidently, supported by access, consciousness and advice.”
Retail participation continues to lead. The gross inflow into B30 locations are more than doubled for two years, grow from £ 1.3 Lakh Crore in FY23 to £ 2.7 Lakh Crore in FY25 (until January). Distributors such as Mutual Fund Distributors (MFDs) and registered investment advisers (RIAs) have seen a considerable traction, in which Ria-guided SIP registrations increase almost four-time in this period.
The data also indicates a diversification trend with B30 investors. The share of investors with exposure to more than four investment fund schemes increased from 20 percent in March 2023 to 22 percent in January 2025. Moreover, 47 percent of the B30 investors now invest by more than one party house, which suggests that a ripening investment approach.
The age segmentation shows that investors aged 20-40 are 56 percent of the B30 investor base, indicating an increasing interest rate from younger demography. In addition, 74 percent of B30 investors are exclusively focused on stock schedules, with another 24 percent diversification over multiple activa classes.
The CAMS report suggests that the momentum at B30 locations is powered by Sachet-Sips Sips, rising digital acceptance and increasing access to financial advisory services. Locations outside the top 10 B30 cities are witnessing faster growth, which underlines the potential of deeper penetration over smaller cities.
The share of B30 in the total AUM of the investment fund industry is now 18 percent, with the exception of institutional funds of cash that are largely concentrated in T30 cities.
Published 15 April 2025
