Was India underestimating household wealth? SEBI’s new data says this

India’s household wealth and savings flowing into financial markets may have been significantly larger than previously reported. A revised methodology introduced by the Securities and Exchange Board of India (SEBI), in consultation with the Reserve Bank of India (RBI) and the Ministry of Statistics and Programme Implementation (MoSPI), suggests that years of household participation in securities markets may have been underestimated.

The strongest indication of this shift is visible in India’s headline savings numbers. Under the revised approach, India’s Gross Savings-to-GDP ratio increased by 47 basis points in FY2024-25 to 34.94%, up from 34.47% under the earlier methodology.

The impact is even more striking when looking at household savings through financial markets. According to the revised estimates, household savings routed via securities markets reached ₹6.91 lakh crore in FY25, significantly higher than the ₹5.43 lakh crore estimated under the earlier framework.

The findings suggest that household wealth was not necessarily absent—it simply was not being fully captured.

What was missing earlier?

For years, national savings calculations relied partly on broad assumptions. Household investments in equity and debt markets were estimated using fixed percentages of public issuances, while several important market channels remained outside the calculation framework. Secondary market investments and newer financial products were largely excluded.

As India’s financial ecosystem evolved and retail participation surged, especially after the pandemic, these gaps became increasingly important.

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Definition of household savings

SEBI’s revised methodology shifts away from assumptions and instead uses more detailed, transaction-level data. The framework now captures a broader set of investments and investor categories, providing what regulators describe as a more realistic picture of household savings behavior.

One of the biggest changes is the inclusion of secondary market activity. Earlier calculations focused primarily on investments flowing through primary market issuances. The revised approach now captures household participation in equity, debt and other market segments beyond first-time issuances.

The framework also expands coverage to include new-age financial instruments such as Real Estate Investment Trusts (REITs), Infrastructure Investment Trusts (InvITs), Alternative Investment Funds (AIFs), municipal bonds, securitized debt instruments and security receipts.

In addition, the methodology now incorporates Non-Profit Institutions Serving Households (NPISHs) — entities such as trusts, societies, associations and NGOs — into household-linked investor classifications.

Retail investors

The data indicate that Indian households are increasingly embracing financial assets. Household savings through securities markets rose to 2.17% of GDP in FY25, compared with 1.71% under the earlier methodology.

Mutual funds have emerged as a key driver of this trend. Primary market household inflows into mutual funds jumped to ₹5.13 lakh crore in FY25, up sharply from ₹2.85 lakh crore in FY24, reflecting stronger retail participation and increasing financial awareness.

Yet despite the rise in market investments, Indian households continue to favor physical assets. Real estate, gold and other tangible assets still account for nearly two-thirds of household savings.

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The bigger picture

The revised estimates also reveal the scale of household wealth already present in financial markets. Total household assets across securities markets—including equities, mutual funds, debt instruments, REITs, InvITs and AIFs—stood at ₹141.34 lakh crore by FY25.

Beyond revising numbers, the findings tell a broader story: India’s shift toward financial assets may have been larger and faster than official data previously suggested. The message from SEBI’s recalculation is clear—India may not just be saving more; it may have been undercounting household wealth all along.

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