ELSS funds: Go-to scheme for tax saving loses traction as new tax regime picks favour; Rs 1,600 crore outflows in Q1 FY26

Equity-linked savings schemes (ELSS) are losing favor among investors as many switch to the new tax regime, which lacks Section 80C benefits. Consequently, Q1 FY26 saw net outflows of Rs 1,616 crore from ELSS funds. With a shorter lock-in period and equity-oriented returns previously attracting investors, ELSS now experiences slower growth compared to other equity funds.