Best Liquid Fund for Short-Term Savings: Axis Liquid Fund vs Nippon India Liquid Fund Comparison

If you are a conservative investor with a low-risk appetite and prefer the safety of fixed deposits, liquid mutual funds can be a good option. These debt-oriented schemes offer high liquidity, relatively low risk, and the potential to generate better returns than traditional savings accounts.

Nippon India Liquid Fund and Axis Liquid Fund are the top performers in the category. They have delivered nearly 7% returns over three years. Here's a comparison of the two liquid fund schemes.

What is A Liquid Fund?

These mutual funds are often better than keeping a lot of money in a savings account. Liquid funds are a type of debt mutual funds which allocate money in instruments like treasury bills and commercial papers. These are short-term debt instruments that're very safe. They are good for people who want to be able to access their money when they need it. They also want to earn a little more than they would with a regular savings account.

Nippon India Liquid Fund vs Axis Liquid Fund

Particulars	Axis Liquid Fund	Nippon India Liquid Fund
Category	Liquid Fund	Liquid Fund
Benchmark	NIFTY Liquid Index A‑I	NIFTY Liquid Index A‑I
Riskometer	Low to Moderate	Moderate
AUM (Closing)	₹62,841.16 crore	₹36,609.54 crore
Expense Ratio (Regular Plan)	0.21%	0.34%
3‑Year Return (Regular)	7.24%	7.19%
Since Inception Return	6.97%	6.84%

Sources: AMFI data as on June 21, 2026.

Axis Liquid Fund vs Nippon India Liquid Fund: Past Returns Comparison

When we look at performance, Axis Liquid Fund has done slightly better than Nippon India Liquid Fund. The difference is not huge because both funds invest in similar assets.

For investors, this means both Axis Liquid Fund and Nippon India Liquid Fund have provided returns, and the difference between them is small.

Both Axis Liquid Fund and Nippon India Liquid Fund are chosen for keeping your money safe and being accessible when you need it. Axis Liquid Fund is considered slightly safer. Both invest in high-quality debt instruments.

Axis Liquid Fund is cheaper with expenses of 0.21% compared to Nippon India Liquid Fund's 0.34%. This means that you get to keep more of the money you earn.

Both Axis Liquid Fund and Nippon India Liquid Fund invest in things like money market instruments and debt instruments. Axis Liquid Fund has investments from the Reserve Bank of India NABARD, Union Bank of India HDFC Bank and Bank of Baroda. Nippon India Liquid Fund has investments from the Reserve Bank of India HDFC Bank, SIDBI, NABARD and Bank of Baroda.

So which one should you choose?

If you want a fund that is slightly cheaper and has a larger size, Axis Liquid Fund might be better. Nippon India Liquid Fund is also a good choice with a long history of performing well in the liquid fund category. It really depends on your preference. Both Axis Liquid Fund and Nippon India Liquid Fund can be good for parking your emergency savings or short-term money.

Just remember that Axis Liquid Fund and Nippon India Liquid Fund are meant for keeping your money safe and accessible, not for making a lot of money in the long term. As per AMFI, the primary focus of short-term debt funds like Liquid Funds is coupon income. These funds also have to be evaluated for the credit risk they may take to earn higher coupon income.