Passive Funds in FY26: Folios Up 37.7%, AUM Up 23.1%

Passive funds entered FY26 as a growing segment of India's mutual fund industry. They exited it as a structurally entrenched one. By March 31, 2026, the passive category held ₹14.11 lakh crore in assets across 5.71 crore folios and 12 sub-categories.

Two stories drove FY26's passive expansion. The first was a clear investor preference for equity index funds and ETFs as a cost-effective route to large-cap exposure. The second was a surge in retail adoption of gold and silver ETFs, with folio counts growing at a scale that points to genuine asset diversification rather than tactical price bets.

This article presents the complete AMFI data on passive fund folios, AUM, and flows for FY26, with a category-by-category breakdown of what drove growth.

FY26 Passive Funds at a Glance

The Folio Story: Where Retail Intensity Showed Up

Folios measure the number of investor accounts in a category, making them a direct gauge of how many people chose to invest, not just how much was deployed. In a year of equity market volatility and a sharp commodity rally, folio data shows where retail conviction ran deepest.

The AUM Story: Where the Assets Sit

Total passive AUM grew 23.08% year-on-year to ₹14,11,715 crore as of March 31, 2026. Three categories account for the majority of assets.

Equity-oriented domestic ETFs hold nearly half of all passive AUM at ₹7.02 lakh crore, underscoring their role as the primary vehicle for index-based investing in India. For an introduction to how index funds work, see the index fund glossary.

Gold ETFs grew AUM by 191% year-on-year to ₹1,71,468 crore, driven by the gold price rally through most of FY26. Silver ETFs grew AUM 420% year-on-year to ₹79,806 crore, a figure that reflects the sharp silver price surge through January 2026 even as prices corrected in the final two months of the financial year.

Equity index ETFs and equity index funds saw more measured AUM growth (7.24% and 17.46% respectively) relative to prior years, weighed down by the market correction in Q4 FY26. The Nifty 50 fell 9.37% in March alone on a close-to-close basis, compressing asset values even as equity index flows remained firmly positive. For context on the broader passive investing trend through FY25, see the article on passive fund flows in India 2025.

Passive Flows in March 2026

March 2026 was a standout month for passive flows. Total net inflows of ₹30,768 crore were more than double February's ₹13,879 crore, even as markets fell sharply and precious metals flows tapered significantly.

Equity Index ETFs dominated March flows with ₹23,820 crore, a 4.3x jump from February's ₹4,487 crore. This acceleration into a falling market points to institutional deployment into passive equity instruments at lower valuations. For the complete equity and SIP flow picture in March 2026, see the mutual fund data breakdown for March 2026.

Gold ETF flows moderated to ₹2,266 crore, well below the January 2026 highs, as gold prices pulled back from their peak. Silver ETF flows were negative for the second consecutive month at −₹684 crore, as investors turned cautious following the extreme price volatility in silver.

Debt Oriented ETFs saw outflows of ₹3,284 crore amid concerns about potential rate pressure during the month. The RBI had maintained its neutral stance at 5.25%, but uncertainty around whether conditions might tighten weighed on debt instrument positioning through March.

Two Structural Trends FY26 Established

Key Takeaways

• Total passive fund AUM grew 23.08% year-on-year to ₹14,11,715 crore as of March 31, 2026. Total folios reached 5.71 crore, up 37.72% year-on-year.
• 11 of 12 passive fund categories recorded folio growth in FY26. Only FOFs in Overseas Passive Funds declined at −13.3%.
• Silver ETF folios grew 710.85% year-on-year to 55.54 lakh and Gold ETF folios grew 77.88% to 1.24 crore, pointing to sustained precious metals adoption through the mutual fund route.
• Equity Oriented ETFs (Domestic) remain the dominant passive category by AUM at ₹7.02 lakh crore, accounting for approximately 49.7% of total passive assets.
• In March 2026, equity ETF inflows surged to ₹23,820 crore (4.3x February), driving total passive net inflows to ₹30,768 crore, more than double the prior month, even as gold and silver flows tapered.
• Gold ETF AUM grew 191% and Silver ETF AUM grew 420% year-on-year, driven by the commodity price rally through FY26. Both categories saw flows moderate in the final months as prices corrected from January 2026 peaks.

FAQs

1. What was the total passive fund AUM in India as of March 2026?

Total passive fund AUM stood at ₹14,11,715 crore (₹14.11 lakh crore) as of March 31, 2026, representing 23.08% growth year-on-year per AMFI data. Equity-oriented domestic ETFs account for nearly half that figure at ₹7.02 lakh crore.

2. Which passive fund category grew the most in FY26?

Silver ETFs recorded the highest folio growth at 710.85% and AUM growth at 420.27% year-on-year, though both figures reflect a relatively low base from March 2025 combined with the sharp silver price rally through most of FY26. Among equity categories, International Equity ETFs grew folios 39.54% and AUM 33.43%.

3. Why did Silver ETF flows turn negative in March 2026?

Silver prices fell sharply from their January 2026 highs. MCX silver hit an all-time high of ₹4,10,000 per kg in the week of January 27, 2026 before correcting significantly. This triggered profit-booking and caution among ETF investors, resulting in two consecutive months of outflows: ₹826 crore in February and ₹684 crore in March (AMFI data). The year-on-year AUM figure still reflects strong growth due to the price appreciation that occurred through most of FY26.

4. Why did equity ETF inflows jump 4.3x in March 2026?

Net inflows into domestic equity ETFs surged from ₹4,487 crore in February to ₹23,820 crore in March. This coincided with a sharp equity market correction with the Nifty 50 falling 9.37% during the month, and institutional investors appear to have deployed capital into passive equity instruments at lower valuations. Equity index funds also saw inflows nearly double month-on-month to ₹6,415 crore.

5. What is driving long-term folio growth in passive funds?

Two factors stand out in the FY26 data: increasing use of equity index funds and ETFs as a cost-efficient large-cap exposure vehicle, and growing retail adoption of gold and silver ETFs as portfolio diversification tools. The folio growth patterns in both segments appear to be structural rather than short-term. Please consult a SEBI-registered investment adviser to understand which passive instruments may be appropriate for your specific financial goals and risk profile.

6. Did any passive fund category see folio contraction in FY26?

Yes. FOFs investing in Overseas Passive Funds was the only passive category to record folio contraction in FY26, declining 13.3% year-on-year to 5.33 lakh folios as of March 2026. Its AUM still grew 11.4%, indicating existing investors stayed invested even as new account openings slowed.

Disclaimer: This article is for general information and educational purposes only. It does not constitute investment advice, a recommendation, or an offer to buy or sell any securities or financial instruments. All data is sourced from the AMFI Monthly Report March 2026 and AMFI Monthly Report February 2026, and is based on publicly available information subject to revision. Year-on-year comparisons are March 2026 versus March 2025. Past market behaviour, fund performance, precious metals price trends, and flow patterns are not indicative of future outcomes. Investors should not make any investment decision based solely on this article. Please consult a SEBI-registered investment adviser or qualified financial professional before making any investment decision. Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing.