Credit risk funds in India
13 live funds in the Credit Risk category, ordered by 5-year return, highest first; DSP Credit Risk Fund leads. Funds younger than five years follow by name. Returns are for the plan each fund's page leads with, Direct where the fund has one, to each fund's latest NAV, the newest of them on 29 Oct 2026; 3 and 5 year returns are a year, compounded.
- Category median, 1 yearCategory median, 1 year. The middle return among the Credit Risk category's funds, each over the same window to its own latest NAV, on their Direct plans.
- +6.91%Middle of 13 funds
- Category median, 3 yearsCategory median, 3 years. The middle return among the Credit Risk category's funds, each over the same window to its own latest NAV, on their Direct plans; a year, compounded.
- +8.70%Middle of 13 funds
- Category median, 5 yearsCategory median, 5 years. The middle return among the Credit Risk category's funds, each over the same window to its own latest NAV, on their Direct plans; a year, compounded.
- +7.71%Middle of 12 funds
Credit Risk funds
Size is the average money the fund managed over its latest quarter. Cost is its yearly expense ratio.Filter them in the screener
DSP Credit Risk FundDSP Mutual FundNAV₹60.87441Y+10.29%3Y+13.67%5Y+13.33%Size₹304 CrCost0.42%
Aditya Birla Sun Life Credit Risk FundAditya Birla Sun Life Mutual FundNAV₹28.12991Y+11.01%3Y+12.84%5Y+10.74%Size₹1,569 CrCost0.81%
HSBC Credit Risk FundHSBC Mutual FundNAV₹37.78881Y+5.63%3Y+11.51%5Y+9.03%Size₹458 CrCost0.84%
Invesco India Credit Risk FundInvesco Mutual FundNAV₹2,348.39281Y+6.94%3Y+8.75%5Y+8.34%Size₹166 CrCost0.28%
ICICI Prudential Credit Risk FundICICI Prudential Mutual FundNAV₹38.60731Y+6.59%3Y+8.77%5Y+7.84%Size₹6,312 CrCost0.80%
Nippon India Credit Risk FundNippon India Mutual FundNAV₹42.43561Y+6.91%3Y+8.70%5Y+7.82%Size₹1,595 CrCost0.61%
SBI Credit Risk FundSBI Mutual FundNAV₹54.07051Y+7.03%3Y+8.27%5Y+7.60%Size₹2,184 CrCost0.90%
Axis Credit Risk FundAxis Mutual FundNAV₹26.45301Y+7.20%3Y+8.59%5Y+7.59%Size₹384 CrCost0.82%
HDFC Credit Risk FundHDFC Mutual FundNAV₹28.31081Y+6.03%3Y+7.97%5Y+7.01%Size₹7,666 CrCost1.01%
UTI Credit Risk FundUTI Mutual FundNAV₹20.87561Y+5.61%3Y+7.58%5Y+6.82%Size₹251 CrCost0.76%
Kotak Credit Risk FundKotak Mahindra Mutual FundNAV₹36.24931Y+5.73%3Y+8.27%5Y+6.60%Size₹772 CrCost0.81%
Bandhan Credit Risk FundBandhan Mutual FundNAV₹19.05621Y+4.95%3Y+7.07%5Y+6.26%Size₹226 CrCost0.66%
Bank of India Credit Risk FundBank of India Mutual FundNAV₹14.94611Y+16.95%3Y+9.97%5Y–Size₹77 CrCost0.61%
Tax on credit risk funds
Gains on units bought on or after 1 Apr 2023 are taxed at the income tax slab rate however long they are held; gains on units bought earlier are taxed at 12.5% when held over 24 months, or over 12 months for a listed fund such as an ETF, and at the slab rate otherwise.
Rules in force from 23 Jul 2024, checked 27 Oct 2026. Surcharge and cess are not included.
About credit risk funds in India
Credit risk funds in India are open ended debt mutual funds that must hold at least 65% of total assets in corporate bonds rated AA and below, excluding AA+. Credit risk is the chance a borrower misses payments. Lower-rated companies pay more interest for that risk.
What SEBI requires
SEBI's category rule asks for a minimum of 65% of total assets in corporate bonds rated AA and below, and AA+ bonds do not count towards that 65%. The category sets no duration band.
Every open ended debt fund except overnight, liquid and the two gilt categories keeps at least 10% of net assets in liquid assets. For a credit risk fund the 65% is measured on the remaining 90%, so about 58.5% of net assets must sit in AA and below bonds. SEBI's circular of 26 Feb 2026 keeps the name and the 65% rule.
Credit risk value
Every debt fund declares a potential risk class, whose credit side uses a credit risk value: each bond scores by rating (AAA 12, AA+ 11, AA 10, A 7, BBB- 3) and the fund's value is the average weighted by holdings. Class A is a value of 12 or more, Class B 10 or more, Class C below 10.
Funds may buy only investment grade securities, rated BBB- or above.
Segregated portfolios
When a bond is downgraded to below investment grade, or an unrated bond defaults, an asset management company may move it into a segregated portfolio, if the scheme's offer document allows it. Investors get matching units in it, and the main portfolio carries on without it.
Neighbouring categories
Corporate bond funds hold at least 80% in AA+ and above rated corporate bonds, the band credit risk funds exclude. Banking and PSU debt funds put 80% in debt of banks, public sector undertakings and public financial institutions. Short and medium term funds are defined by duration, not by rating.
The fund list and tax
The page lists every live fund in the category with its latest NAV (net asset value, the price of a unit), returns over 1, 3 and 5 years, size and cost, using the Direct plan where one exists. The 3-year and 5-year returns are annualised, meaning compounded per year.
Funds are sorted by 5-year return, highest first, and funds with less than five years of history follow, sorted by name. A dash marks a period the fund is too new to have. Size is the average money managed over the latest quarter, and cost is the yearly expense ratio. Category medians are the middle return in each window.
Gains on credit risk fund units bought on or after 1 Apr 2023 are taxed at the holder's income tax slab rate, whatever the holding period, with no indexation.