Smaller cities add more new SIP accounts but see higher premature terminations: SEBI data

Smaller cities beyond the top 30 (B-30) added new systematic investment plan (SIP) accounts at a faster rate than the top-30 (T-30) cities between FY 20219-20 and FY 2025-26. However, they also witnessed higher premature SIP terminations than the T-30 cities during this period, according to SEBI's Handbook of Statistics 2025-26.

The data, presented in the Handbook's Table 69 on "Resource Mobilisation through Systematic Investment Plans," tracks SIP accounts across T-30 and B-30 cities on parameters including new registrations, maturities, and SIPs terminated prematurely during FY 2019-20 and FY 2025-26.

In 2025-26, investors in B-30 cities prematurely terminated 379.16 lakh SIP accounts, compared with 260 lakh in T-30 cities. However, the B-30 cities also saw higher new SIP registrations, at 389 lakh, compared to 267 lakh in T-30 cities.

In proportional terms, the B-30 cities saw more new SIPs as well as premature terminations than T-30 cities in FY 2025-26.

The trend has been almost consistent since FY 2019-20.

In most years between 2019-20 and 2025-26, the number of SIPs terminated prematurely was higher in B-30 cities than in T-30 cities.

In 2019-20, both B-30 and T-30 cities had 22 lakh premature terminations. However, the gap in premature closure between the two sets of cities widened in the following years.

The B-30 cities overtook T-30 cities in premature terminations from 2021-22 onwards. That year, B-30 cities recorded 37 lakh premature terminations against 29 lakh in T-30 cities. The gap has only grown since. In 2024-25, B-30 accounted for 280 lakh premature terminations against 202 lakh in T-30 cities. However, the number of new SIPs registered in B-30 cities has been much higher than in T-30 cities during this period.

The overall scale of premature closures has increased manifold since 2019-20.

Data shows that the total premature SIP terminations across both city categories surged from 43.75 lakh in 2019-20 to 638.78 lakh in 2025-26, a nearly 15-times increase. In the same period, the total SIP AUM grew from ₹2,38,821 crore to ₹14,82,979 crore.

The data also reveals that 2025-26 was the first year when total SIP accounts in the country did not grow.

The number of accounts at the end of 2025-26 stood at 988 lakh, marginally lower than the 992 lakh at the beginning of the year. This happened because premature terminations, at 638.78 lakh, nearly matched new registrations of 655 SIP accounts lakh during the year.

The B-30 picture is particularly telling. While B-30 cities added 389 lakh new SIP accounts in 2025-26, they also saw 379 lakh premature terminations and 8 lakh maturities. The net addition was just 1.59 lakh accounts, taking the closing count to 543 lakh.

In contrast, T-30 cities actually saw a net decline of nearly 5 lakh accounts, from 450 lakh at the start to 445 lakh at the end.

AUM remains positive

Despite the churn, the AUM story remains positive. T-30 cities accounted for ₹9,71,572 crore in SIP AUM at the end of 2025-26, up from ₹1,60,053 crore in 2019-20. B-30 cities saw their SIP AUM grow from ₹78,768 crore to ₹5,11,407 crore over the same period.

The growing AUM even as accounts are shut suggests that while smaller investors in smaller cities may have exited their SIPs, those who stayed invested contributed larger amounts. It also points to the possibility that many investors may have consolidated multiple SIP accounts or moved towards lump sum investments.