Franklin India Money Market Fund - Direct Plan - Growth
Why This Fund?
I chose this fund as my primary "parking" vehicle for excess funds because of its best-in-class credit profile, daily liquidity, and consistent focus on capital preservation. The cautious, well-diversified portfolio of Franklin Templeton's Money Market Fund is reflected in its sustained rankings of "AAA" by CRISIL and "A1+ mfs" by India Ratings.
Key Information
- Benchmark: NIFTY Money Market Index (A-I)
- Expense Ratio (Direct Plan): 0.24% p.a. (as of Apr 2025)
- AUM: ₹3,276.58 cr (as of Apr 2025)
- Riskometer: 🛡️ Low to Moderate
Also Read: Franklin India Opportunities Fund – Direct Growth Analysis
Key Metrics & Performance
Latest NAV (13 Jun 2025)
₹51.8093
1 Year Return
8.37%
5 Year CAGR
6.02%
CAGR (Since Inception)
7.23%
Annualised Performance vs. Benchmarks
Trailing returns as of 30 Apr 2025.
| Period | Fund (Direct Growth) | Benchmark (NIFTY MM Index A-I) | Benchmark 2 (CRISIL 1-Year T-Bill) |
|---|---|---|---|
| Last 1 Year | 8.49% | 7.86% | 8.04% |
| Last 3 Years | 7.72% | 7.58% | 7.44% |
| Last 5 Years | 6.69% | 6.68% | 6.40% |
| Last 10 Years | 6.57% | 6.33% | 6.18% |
| Since Inception (Jan 2013) | 7.23% | 6.52% | 6.24% |
Portfolio & Credit Quality (Apr 2025)
Portfolio Credit Quality
100% of holdings are rated CRISIL A1+ / CARE A1+ / IND A1+ / ICRA A1+ or are Sovereign Gilts.
Key Portfolio Stats
The fund maintains a very short duration, minimizing interest rate risk and focusing on high-quality, liquid instruments.
- Modified Duration: 0.75 years
- Average Maturity: 0.47 years
- Macaulay Duration: 0.43 years
- Yield to Maturity: Not specified
- Month-End AUM: ₹3,276.58 crores
- Monthly Avg. AUM: ₹3,017.09 crores
The Power of Compounding: SIP Analysis
SIP Growth Trajectory (₹10,000/month)
An investment of ₹10,000 per month from Jan 2013 to Apr 2025 (total invested ₹27.90 Lakh) would have grown significantly.
| Years Invested | Total Invested | Value on 30 Apr 2025 |
|---|---|---|
| 1 (by 2014) | ₹1,20,000 | ₹1,25,366 |
| 3 (by 2016) | ₹3,60,000 | ₹4,04,429 |
| 5 (by 2018) | ₹6,00,000 | ₹7,10,222 |
| 10 (by 2023) | ₹12,00,000 | ₹16,81,938 |
| ~12.3 (by 2025) | ₹27,90,000 | ₹70,10,729 |
The Math of Compounding
By reinvesting returns, even a modest excess yield over bank FDs can lead to exponential growth over time. The future value of a SIP is calculated using:
Over the same span, traditional bank FDs (~6% p.a.) and savings accounts (~3–4% p.a.) would have compounded to roughly ₹60 Lakh and ₹40 Lakh respectively on a ₹10K SIP—underscoring this fund’s edge in blending safety, liquidity, and superior yield.
Franklin India Money Market Fund: Analysis
Risk & Safety Metrics
Interest-Rate Risk
Extremely low because the average maturity is only 0.47 years, and NAV barely fluctuates in response to changes in rates.
Credit-Default Risk
Very low—all holdings have an A1+/SOVEREIGN rating, which indicates top-tier paper.
Daily Exit Load & Liquidity
Redeem at the current NAV on any business day with no exit load for every redemption.
India's Debt Fund Tax Treatment
Short-term gains (≥3 years) are added to your income and subject to slab rate taxation. Gains above three years are subject to 20% taxation with indexation.
Note: The NAV (Net Asset Value) represents the per-unit market value of a mutual fund.
Peer Comparison: Low-Risk Alternatives
| Scheme | Direct Expense Ratio | Portfolio YTM | Avg Maturity |
|---|---|---|---|
| Franklin India Money Market Fund | 0.14% | 6.80% | 0.47 yrs |
| Franklin India Liquid Fund | 0.07% | 6.04% | 0.01 yrs (≈ 2 days) |
| Franklin India Overnight Fund | 0.07% | 5.25% | 0.01 yrs (≈ 1 day) |
| Franklin India Low Duration Fund | 0.26% | 6.90% | 1.00 yrs |
Advantages and Disadvantages of Fund Types
Money Market Fund (FIMMF)
- No exit loads
- Less interest-rate volatility
- Higher yield than overnight or liquid funds
- Somewhat longer maturity
- Slightly lower yield than Low Duration at high rates
Liquid Fund (FILF)
- Extremely strong liquidity (1 day)
- Rates about 0.75 percentage points lower
Overnight Fund (FIONF)
- Unrivaled liquidity and safety
- Yields about 1.2 percentage points less than FIMMF
Low Duration Fund (FILWD)
- Higher long-term yields
- Small one-year exit-load window
- Larger NAV fluctuations if rates change
Step-by-Step: Start Your SIP Right Now
Select a Platform
Any AMC website (Franklin Templeton) that is registered with AMFI, CAMS, KFin, or well-known apps (Groww, Zerodha, ET Money).
Bank Mandate & KYC
Finish the e-KYC process (Aadhaar + PAN). Set up an ECS mandate or NACH for automatic ₹10,000 debit.
Set Up the SIP
Choose the Growth Option, Direct Plan, and Franklin India Money Market Fund. Enter commencement date and SIP amount (₹10,000).
Track and Rebalance
Quarterly: Evaluate peers' NAV and YTM. Rebalance if cash allocation drops below goal (e.g., 10% of portfolio).
SIP Calculator: Franklin India Money Market Fund
Projected value: ₹10K SIP → ₹70L+ in 23 years
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