Mutual Fund NFO Filings Double in 2025 Despite Decline in Fund Collections
The mutual fund industry has witnessed a steep rise in the draft filings of new fund offerings (NFOs) in 2025 whereas actual fund raising has declined. Figures show that mutual fund houses have filed 64 draft papers with the Securities and Exchange Board of India (SEBI) this year, up from 32 filings made in 2024.
Rise in Passive and Debt Fund Filings
The surge in filings has been driven mainly by index funds and exchange-traded funds (ETFs), which have seen growing investor interest amidst market volatility. Filings in index funds have gone up from 9 in 2024 to 21 in 2025, and ETF filings have also gone up from 6 to 15 over the same period.
The trend represents shifting investor preference towards passive investment plans, which promise stability during periods of fluctuating market circumstances. Additionally, debt fund applications have remained high in 2025 with 11 applications compared to 8 in 2024, since fund houses look for fixed-income plans to provide safety in uncertain market situations.
For the first two months of the year, the number of passive NFOs rolled out has increased, from 5 in January 2025 to 18 in February 2025. This is evidence of the rising demand for passive investment strategy.
Key NFO Filings of 2025
Several fund houses have brought out new index funds and ETFs, some of which include:
- Index Funds: SBI Nifty200 Quality 30 Index Fund, Axis Nifty500 Low Volatility 50 Index Fund, and Edelweiss BSE Internet Economy Index Fund.
- ETFs: ICICI Prudential Nifty EV & New Age Automotive ETF FOF, Angel One Nifty Total Market ETF, and Kotak Nifty 200 Quality 30 ETF.
The debt segment has also seen a number of filings like Bandhan Fixed Maturity Plan Series 214 (370 Days) and Axis CRISIL-IBX AAA Bond Financial Services – Dec 2026 Index Fund.
Equity fund filings have nearly doubled compared to the previous year, increasing from 7 in 2024 to 13 in 2025. The key equity fund filings are Samco Large and Mid Cap Fund, Axis India Multi-Sector Growth Fund, and Motilal Oswal Active Momentum Fund.
In the hybrid fund category, products like UTI Income Plus Arbitrage Active Fund of Fund and Unifi Dynamic Asset Allocation Fund have been filed in 2025.
Decline in NFO Collections
Even as NFO filings have increased, collections of funds have actually dipped. One recent instance of this was seen when a top fund house withdrew its NFO for the Axis Nifty 500 Momentum 50 Index Fund on the launch eve without mentioning a reason.
66 NFOs have been launched until now in 2025, of which 41 have been launched during January and February. This stands in contrast to 56 NFOs launched during January-March 2024, including 42 up to February 28. Though new funds launched have increased, the collections through these funds have come down.
Equity scheme inflows were positive in February 2025 but dropped by 26% compared to the previous month to Rs.29,303.34 crore. Debt funds, having seen inflows of Rs.1.28 lakh crore in January 2025, saw outflows of approximately Rs.6,526 crore in February 2025.
AMFI figures show that total money collected from NFOs in January and February 2025 was Rs.8,573 crore, a significant drop from Rs.18,537 crore in 2024. In March 2024, Rs.4,146 crore was collected from NFOs.
Challenges and Future Outlook
With falling inflows into equity mutual funds, market participants see short-term distress for the mutual fund industry. Mutual fund inflows can be volatile in the near term, says a recent report. But it also observes that big and well-established fund houses are poised to grow while new entrants may be at risk.
As more NFOs are being launched by mutual fund houses, the emphasis is on maintaining investor demand against manageable fund collection growth in the months ahead.
