Debt mutual funds are generally chosen for stability and predictable returns, not spectacular gains. Yet some schemes have managed to deliver equity-like SIP returns over the long run. The catch? There are very few of them.
An analysis of Value Research data as of July 4, 2026 shows that only four debt mutual fund schemes have generated annualised SIP returns exceeding 10% over the past 10 years. Even after lowering the threshold to 8%, just nine schemes qualify.
The findings highlight that while strong returns are easier to find over shorter periods, sustaining them over a decade has proved exceptionally difficult.
How many debt funds rewarded SIP investors?
The number of debt funds meeting key SIP return milestones falls sharply as the investment horizon increases.
For instance, 35 debt funds generated annualised SIP returns of 8% or more over the past three years. That number drops to 22 over five years and further to just nine over a decade. Similarly, while six schemes crossed the 10% mark over three years, only four managed to maintain double-digit annualised SIP returns over 10 years.
|
Annualised SIP return |
3 years |
5 years |
10 years |
| 8% and above | 35 | 22 | 9 |
| 9% and above | 12 | 7 | 4 |
| 10% and above | 6 | 5 | 4 |
Source: Value Research, Data as of July 4, 2026
The data shows that although several debt funds have benefited from the recent interest-rate cycle, only a handful have been able to sustain high returns over a full decade.
Only four funds crossed the 10% mark over a decade
Just four schemes managed to deliver annualised SIP returns of more than 10% over the last 10 years.
Three of the four schemes belong to the Credit Risk Fund category, while the fourth is a Medium Duration Fund. This suggests that funds willing to take relatively higher credit exposure have been the biggest beneficiaries over the past decade.
Five-year performance paints a broader picture
The list expands slightly when the investment period is reduced to five years, with one additional scheme joining the double-digit club.
The dominance of credit risk funds continues, accounting for four of the five schemes. Their higher exposure to lower-rated corporate bonds has helped generate superior returns, although it comes with a higher level of risk than categories such as banking & PSU or liquid funds.
Which schemes led the 3-year debt fund rankings?
Over a three-year horizon as well, same five schemes managed annualised SIP returns above 10%.
The analysis shows that while a larger number of debt funds have delivered strong returns in recent years, sustaining that performance over longer periods has been far more difficult. Only four schemes managed to generate double-digit annualised SIP returns over 10 years, and just nine crossed the 8% mark.
Moreover, the same names appear repeatedly across different time periods. DSP Credit Risk Fund, Bank of India Credit Risk Fund, Aditya Birla Sun Life Credit Risk Fund and Aditya Birla Sun Life Medium Term Fund feature among the top performers over three, five and 10 years, suggesting that sustained performance is far rarer than a temporary surge in returns.
