Gig workers can now start mutual fund SIPs with just ₹100 a day; here’s how

Gig workers can now invest as low as ₹100 a day in a mutual fund (MF) through a fintech app. Zeny, a newly launched fintech platform founded by Oxford University alumni Nikhil Nair and Nikhil Saigal, has gone live on the Open Network for Digital Commerce (ONDC) with its daily MF SIPs (Systematic Investment Plans) customer app.

The app aims to enable India’s informal workforce to invest as little as ₹100 per day in the Aditya Birla Sun Life Liquid Fund. Zeny said its approach encourages ‘digital sachet savings,’ wherein small, frequent deposits are made through UPI (Unified Payments Interface) auto-pay, helping to build good financial habits among informal workers and making it easy for them to manage and grow their money.

“Mutual fund Assets Under Management (AUM) have grown at a 20% CAGR (compounded annual growth rate) over the past decade, yet penetration among informal workers is sub-2%. We want to change that by enabling access to mutual funds beyond urban affluent segments,” said Nikhil Nair, Co-founder and CEO, Zeny.

“For first-time investors from the informal workforce, a low-volatility liquid fund can act as a safe on-ramp. Our service offers fixed deposit-style returns with no lock-ins and the flexibility to deposit and withdraw money every day,” he said.

Liquid funds and ONDC’s role in access

Aditya Birla Sun Life Liquid Fund has gained 7.1% over the last year and is among the top-7 performers in the category. It is a five-star-rated fund in its category. Liquid funds, which have a moderate risk, have generated returns of 6.6% on average in the past year.

Aditya Birla Sun Life Liquid Fund, which has an AUM of nearly ₹52000 crore, has invested predominantly in certificates of deposits (CDs) issued by banks, commercial paper (CP), and debentures offered by leading corporates and treasury bills issued by the RBI (Reserve Bank of India).

Low-cost MFs or SIPs for ₹100 are not new in India. SIPs for ₹100 are offered by MFs investing in gold, benchmark stock indices, and corporate bonds. India’s gig workers, who include drivers, plumbers, cooks, electricians, and mechanics, can earn an interest of between 6%-7% on their sachet-sized daily savings, Zeny said.

“ONDC was built to democratize access, to ensure that every Indian, regardless of income, geography, or digital literacy, can participate in the formal economy,” said Vibhor Jain, Acting CEO and COO, ONDC. ONDC is a non-profit company established under the initiative of DPIIT (Department for Promotion of Industry and Internal Trade) of the government to democratise India’s e-commerce landscape by creating an open and interoperable network.

Quantum MF joined the ONDC network recently to simplify MF distribution. ONDC aims to provide seamless connectivity between AMCs (Asset Management Companies) and MF distributors.

Allirajan M is a journalist with over two decades of experience. He has worked with several leading media organisations in the country and has been writing on mutual funds for nearly 16 years.

For all personal finance updates, visit here.

Disclaimer: Mint has a tie-up with fintechs for providing credit; you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards, and credit scores. Mint does not promote or encourage taking credit, as it comes with a set of risks, such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.