FM INDICATES INFLATION
Mumbai
Finance Minister Nirmala Sitharaman on Tuesday said household net financial assets rose to ₹9.9 lakh crore, or 6 per cent of GDP, in FY25, up from 5.3 per cent in FY24. Citing RBI data, she noted that this marks a strong rebound from the steep decline in FY23, when savings had fallen to 4.9 per cent of GDP — the lowest level since the early 1970s.
At the same time, households’ financial liabilities saw a sharp contraction. Liabilities dropped to ₹15.7 lakh crore in FY25, or 4.7 per cent of GDP, compared to ₹18.8 lakh crore (6.2 per cent of GDP) recorded a quarter earlier. The moderation aligns with overall credit growth slowing to 12 per cent in FY25 from 16 per cent in FY24, partly due to tighter rules for unsecured and retail lending.
RBI data shows that gold-backed loans continued to rise, reflecting a preference for quick, collateralised borrowing, though the pace appears to be stabilising under increased regulatory scrutiny. However, the most striking trend is the surge in equity investments. Market-linked instruments accounted for an all-time high of 15.1 per cent of household financial assets in FY25, up significantly from 8.7 per cent in FY24 and 7.3 per cent in FY23.
This rapid growth highlights rising household confidence in capital markets, fuelled by strong equity performance and prospects of higher returns. Meanwhile, the share of bank deposits declined to 35.2 per cent in FY25 as savers continued shifting away from low-yield traditional instruments in favour of more market-driven avenues.
