India’s savings have stagnated in 2023, as per the findings of a new survey. Also, the preference for mutual funds has gained significance while savings bank accounts remain the most popular financial product.
The survey further highlights the importance of saving for emergencies and addressing other financial goals. About 47.3% of respondents reported that their savings had witnessed a downward trend in 2022, but this number reduced to 41.7% in 2023.
Notwithstanding the slight improvement, the survey highlighted that savings have stagnated for a larger percentage of individuals. About 32.1% reported no change in their savings in 2022; the number has jumped to 37.0% in 2023.
Interestingly, 2023 is the second year in a row where mutual funds have pipped Fixed Deposits (FDs) as the preferred choice for investment. About 54% of individuals prefer to invest in mutual funds; this is closely followed by FDs, which are preferred by 53% of individuals.
In addition, about 77% of individuals preferred savings bank accounts, which emerged as the highest percentage of takers when it comes to financial products. Also, the top reasons for saving include emergencies (61%), children and inheritance (58%), and lifestyle upgrades (45%).
At 79%, more men chose savings bank accounts compared to women, the number for which is 76%. From 7% in 2022 to 8% in 2023, the gap between men and women investing in stocks has widened, albeit marginally.
About 39% of women bought stocks compared to 47% of men in 2023. Significantly, fewer women chose riskier investments, such as cryptocurrency, in 2023 compared to men. Public Provident Fund (PPF) at (26% and real estate at 19) were the two products chosen by an equal percentage of men as well as women.
Going region-wise, savings have reduced or stagnated for most people across India in 2023. The highest dip in savings was recorded in the North at 44%, while the West at 25% reported the highest percentage of stagnating savings. The South reported the lowest downswing in savings, at 40%.
At 42%, metro and non-metro cities also displayed parallel trends when it came to declining savings.
Rajiv is an independent editorial consultant for the last decade. Prior to this, he worked as a full-time journalist associated with various prominent print media houses. In his spare time, he loves to paint on canvas.
