India is on track to welcome more than 100 million additional individuals into long-term investing by 2035, according to a recent report from EY titled "Wealth Inclusion in India: Expanding Investor Participation Beyond Metro India." This ambitious growth is anticipated to broaden investor participation significantly beyond major metropolitan centers.
The Next Wave of Investors
The EY report identifies several key demographics that will drive this expansion. These include salaried households in Tier-2 and Tier-3 cities, a rising cohort of women wealth creators, young professionals, Gen Z investors, and emerging affluent households. The opportunity is underscored by a notable disparity between widespread digital financial access and actual investment engagement.
Currently, India boasts over 550 million active UPI users, yet only around 62 million individuals invest in mutual funds and approximately 50 million actively participate in equity markets. This indicates that while financial access has expanded rapidly, broad-based wealth participation is still in its nascent stages.
Growth Beyond Metro Areas
Evidence of this shift is already apparent. Cities beyond India's top 110 contributed 12% of mutual fund Assets Under Management (AUM) in FY25. Furthermore, districts outside the top 10 accounted for 70% of NSE-registered investors trading during the same fiscal year. The share of investors under 30 years old surged to 38% in June 2026, up from 23% in FY19. In B30 cities, women's participation as investors grew from 20% in FY19 to 25% in FY24.
The report also highlights a strengthening culture of systematic investing. Systematic Investment Plans (SIPs) now constitute 35% of individual mutual fund AUM, a substantial increase from 19% in FY19. Initiatives like micro-SIPs, valued around US$2.6, coupled with distribution partnerships reaching over 250,000 rural touchpoints, are crucial in bringing first-time and underserved investors into the market.
From Access to Wealth Creation
India's household asset mix is evolving, with investable assets reaching nearly US$5.2 trillion in FY25. Individual investors collectively accounted for 18.7% of the Indian equity market through direct equity and mutual fund ownership.
However, EY emphasizes that simply increasing access and opening investment accounts will not suffice. The inherent complexity and perceived volatility of investment products often create a barrier, necessitating greater guidance and enhanced financial literacy. To address this, the report proposes a comprehensive "Wealth Stack":
- Digital identity
- Streamlined payments
- Recurring investment mechanisms
- Consent-based financial data sharing
- AI-enabled intelligence
- Scalable advice platforms
- Robust investor protection measures
EY projects that individual mutual fund AUM could surpass US$3 trillion, while individual direct equity holdings might reach US$2.5 trillion to US$3 trillion over the next decade. The ultimate success of India's wealth-inclusion journey, the report argues, should be measured not just by account openings or AUM, but by sustained investor persistence, diversification, financial resilience, and long-term wealth outcomes.