“No Risk, No Reward”: Indians Shift from FDs to Stock Market, RBI Data Shows

Investment Trends: Indian investors are changing the way they save and invest. According to the Reserve Bank of India (RBI), traditional instruments like fixed deposits (FDs) are seeing declining interest, while equities and mutual funds are gaining traction.

New Delhi: In 2020, the web series Scam 1992 captured the rise and fall of Harshad Mehta, with actor Pratik Gandhi portraying the infamous stock market king. One dialogue that stood out—“If you love, you must take risks”—was delivered when the character ventured into the stock market. Today, a similar trend is visible among Indian investors.

The RBI reports that more Indians are now willing to invest in the stock market. While equities carry higher potential returns, they also come with higher risks. Investors seeking bigger gains are increasingly ready to embrace these risks.

In the financial year 2012, 57.9% of Indians’ total savings were in bank deposits (FDs or savings accounts). By FY2025, this had dropped to 35.2%, signaling a growing willingness to invest in higher-risk options like the stock market.

Rising Share of Stocks and Mutual Funds

RBI data reveals that the share of equities and investment funds in total domestic financial assets rose to 23% by March 2025, up from 15.7% six years earlier.

• Direct household participation in the stock market grew from below 8% in FY2014 to nearly 9.6% by September 2025.
• Indirect participation via mutual funds tripled, reaching 9.2% during the same period.
• The share of stocks and mutual funds in annual domestic financial savings increased from around 2% in FY2012 to over 15.2% in FY2025.
• Total equity holdings by households rose sharply from ₹8 lakh crore in FY2014 to approximately ₹84 lakh crore by September 2025.

Meanwhile, bank deposits fell to their lowest in years, dropping to 31.95% in FY2022.

Are Indians Abandoning Banks?

The Economic Survey clarifies that this decline does not indicate that Indians are leaving banks. Rather, they are diversifying their savings, supplementing traditional instruments with investments in the stock market. At the same time, low-risk bond products are attracting less capital.