AMFI Data September 2026: Equity Fund Inflows Rise 31% as Debt Funds Witness Heavy Withdrawals

India's mutual fund industry reported contrasting investment trends in September 2026, with equity schemes recording stronger inflows even as debt-oriented funds experienced substantial withdrawals. Investors continued allocating capital to equity funds despite weakness in domestic stock markets, while redemptions from short-term debt categories weighed heavily on overall industry flows.

Data published by the Association of Mutual Funds in India (AMFI) showed that equity mutual funds received net investments of ₹38,306.55 crore during September, an increase of 30.61% from ₹29,328.62 crore in August. This translated into additional net inflows of ₹8,977.93 crore over the previous month.

Despite the improvement in equity inflows, the mutual fund industry recorded net withdrawals of ₹1,33,375.57 crore in September, compared with positive flows of ₹41,353.60 crore in August. The change was primarily driven by debt mutual funds, which witnessed net redemptions of ₹1,83,155.76 crore during the month.

The figures highlight the difference in investment activity across asset classes, with equity schemes continuing to receive fresh allocations while liquidity-oriented debt products faced considerable redemption pressure.

Small-Cap Funds Remain the Top Choice Among Equity Investors

Small-cap mutual funds maintained their lead among actively managed equity categories, attracting net investments of ₹9,038.57 crore in September. This was 13.36% higher than the ₹7,973.33 crore received in August, reflecting continued investor interest in smaller companies despite volatility in the broader market.

Mid-cap schemes ranked second, collecting ₹7,834.84 crore compared with ₹6,989.40 crore in the preceding month, an increase of 12.10%. Together, small-cap and mid-cap funds accounted for approximately 44% of total net investments in equity mutual funds during September.

Flexi-cap funds also registered a healthy improvement, with inflows climbing 32.46% to ₹6,701.80 crore from ₹5,059.42 crore in August. These schemes provide fund managers with the flexibility to allocate capital across companies of different market capitalisations.

Large-cap funds returned to positive territory after witnessing withdrawals in August. The category received net inflows of ₹859.47 crore in September, reversing the previous month's outflows of ₹1,147.36 crore.

Similarly, sectoral funds recorded net investments of ₹1,840.02 crore, against marginal withdrawals of ₹53.19 crore in August. Thematic funds attracted ₹1,800.07 crore, slightly above the ₹1,766.19 crore received in the previous month.

Large and mid-cap funds collected ₹4,271.22 crore, while multi-cap funds attracted ₹3,859.55 crore.

The sustained investments in small-cap, mid-cap and diversified equity categories indicate that investors continued directing money towards equities, even as market conditions remained challenging.

Debt Funds Record ₹1.83 Lakh Crore Outflows in September

Debt-oriented mutual funds witnessed a substantial increase in net redemptions during September, with total outflows reaching ₹1,83,155.76 crore. In comparison, the category had reported relatively modest withdrawals of ₹8,127.32 crore in August.

Liquid funds contributed the largest share of these redemptions, recording net outflows of ₹95,743.20 crore. This marked a sharp reversal from the ₹19,934.29 crore inflows registered in the previous month.

Money market funds also experienced heavy withdrawals, with net outflows of ₹50,846.21 crore compared with inflows of ₹11,734.71 crore in August.

Ultra-short-term funds reported redemptions of ₹11,728.87 crore after receiving ₹4,256.55 crore in the preceding month. Overnight funds witnessed withdrawals of ₹7,281.20 crore, although this was considerably lower than the ₹30,654.25 crore outflows recorded in August.

Among other categories, corporate bond funds registered net outflows of ₹4,652.24 crore, while banking and PSU debt funds experienced redemptions of ₹2,411.55 crore.

The significant withdrawals from liquid, money market and other short-duration schemes may be associated with quarter-end liquidity management and institutional cash requirements. However, the AMFI report does not provide an investor-wise breakdown or specify the reasons for these withdrawals.

Hybrid Mutual Funds Turn Negative as Arbitrage Funds Face Selling Pressure

Hybrid mutual funds reported net outflows of ₹456.68 crore in September, compared with net investments of ₹10,045.34 crore in August. The reversal was largely attributable to redemptions from arbitrage, balanced advantage and equity savings schemes.

Arbitrage funds recorded withdrawals of ₹3,956.38 crore after attracting ₹3,789.02 crore in August, representing a substantial change in monthly flows.

Balanced advantage funds also moved deeper into negative territory, with outflows increasing to ₹912.43 crore from ₹227.90 crore in the previous month. Equity savings funds recorded withdrawals of ₹1,227.86 crore, compared with ₹246.05 crore in August.

However, not all hybrid categories experienced weak inflows.

Multi-asset allocation funds continued to receive steady investments, collecting ₹3,666.98 crore during September, compared with ₹3,670.97 crore in August.

Aggressive hybrid funds recorded an increase in inflows to ₹1,863.54 crore from ₹1,322.79 crore, indicating continued demand for schemes combining equity and debt exposure.

The variation across hybrid categories suggests that investor preferences differed considerably depending on the underlying asset allocation and investment strategy.

Gold ETF Inflows Rise Over 71% as Investors Increase Allocations

Gold exchange-traded funds registered one of the strongest monthly increases among the major mutual fund categories during September.

Net investments in gold ETFs climbed to ₹4,450.61 crore from ₹2,596.70 crore in August, representing growth of 71.39%.
The increase indicates stronger investment demand for gold-backed products during a period marked by fluctuations in equity markets.

Silver ETFs also attracted higher investments, with net inflows rising to ₹1,974.32 crore compared with ₹1,270.63 crore in August, an increase of approximately 55.38%.

Meanwhile, equity ETFs recorded inflows of ₹9,959.96 crore, up 37.62% from ₹7,237.49 crore in the preceding month, indicating continued interest in passive equity investment products.

The overall index fund category, however, witnessed net outflows of ₹3,614.03 crore, reversing the ₹787.49 crore inflows registered in August.

This decline was mainly attributable to debt index funds, which experienced redemptions of ₹6,257.82 crore. Equity index funds remained positive, receiving ₹2,649.34 crore compared with ₹2,392.87 crore in August, an increase of 10.72%.

Overseas fund-of-funds schemes also witnessed higher withdrawals, with net outflows increasing to ₹159.18 crore from ₹72.19 crore in the previous month.

Other ETFs recorded marginal net inflows of ₹0.45 crore.

The rise in gold and silver ETF investments, alongside sustained equity ETF flows, highlights continued interest in both passive investing and precious-metal-linked products.

Industry AUM Falls Over 5% Despite Stronger Equity Investments

The mutual fund industry's assets under management (AUM) declined during September, reflecting the combined impact of market movements and net withdrawals.

Total industry AUM stood at ₹82.64 lakh crore as of September 30, 2026, compared with ₹87.08 lakh crore at the end of August, representing a decline of approximately 5.10%.

Assets managed by equity mutual funds declined to ₹37.54 lakh crore from ₹39.21 lakh crore in August.

The reduction in equity AUM, despite higher net investments, indicates that declines in the market value of underlying holdings outweighed fresh inflows during the month.

However, the industry continued to witness growth in mutual fund accounts.

The total number of folios increased from approximately 28.35 crore in August to 28.62 crore in September, an addition of around 27.13 lakh folios.

This increase indicates continued expansion in mutual fund account holdings even as industry assets declined. However, the number of folios does not represent the number of unique investors, as an individual may hold multiple mutual fund accounts.

Equity Investments Remain Resilient Despite Divergent Fund Flows

September's AMFI data reveals a distinct contrast between equity-oriented investments and short-term debt fund activity.
While heavy redemptions from debt mutual funds resulted in overall industry outflows exceeding ₹1.33 lakh crore, equity schemes recorded a considerable improvement in monthly investments.

Small-cap funds continued to attract the largest inflows among actively managed equity categories, followed by mid-cap and flexi-cap funds. At the same time, rising allocations to gold ETFs indicated growing investor interest in precious-metal-linked investment products.

The increase in equity mutual fund inflows during a period of market weakness suggests that investors continued allocating capital to equities rather than withdrawing broadly from the asset class.

However, the decline in industry AUM demonstrates that positive fund flows do not necessarily translate into higher portfolio valuations, particularly during periods of substantial market corrections.

Overall, the September data points to continued equity investment activity alongside significant liquidity-driven movements in debt and hybrid categories.