SEBI Revises Household Savings Methodology for FY25, Ratios Move Higher

The Securities and Exchange Board of India (SEBI) has revised the methodology used to estimate household savings through the securities market, resulting in a higher savings-to-GDP ratio for 2024-25, as per news reports. 

According to a research paper released by SEBI, India’s gross savings rate for FY25 was estimated at 34.94% of GDP under the revised framework. Under the earlier methodology, the ratio would have stood at 34.47%. 

The paper was prepared by officials from SEBI’s Department of Economic and Policy Analysis (DEPA). 

Household Savings Estimates Increase 

The revised methodology also changed estimates for household financial savings during the year.  

Under the updated framework, the household savings-to-GDP ratio for FY25 was estimated at 21.7%, compared with 21.23% under the previous approach. 

Net household financial savings were revised upwards to 7.10% of GDP from 6.63% estimated earlier. 

SEBI stated that the revised calculation uses granular primary-source data and offers wider coverage of investments linked to the securities market. 

Coverage of Market Investments 

The earlier methodology relied largely on Reserve Bank of India (RBI) data related to mutual fund assets under management held by individual investors. 

According to the paper, these excluded investments are made by households in equities, debt securities, real estate investment trusts (REITs), infrastructure investment trusts (InvITs), and alternative investment funds (AIFs). 

The revised framework includes these categories along with secondary market investments and data relating to non-profit institutions serving households. 

Household savings routed through the securities market were estimated at ₹6.9 trillion in FY25 under the revised methodology. Under the earlier method, the estimate stood at ₹5.42 trillion. 

Change in Investment Pattern 

The paper noted that the revised estimates show a gradual shift in household savings towards financial instruments from traditional physical assets such as gold and real estate. 

It also highlighted that households remained net sellers of direct equities during FY25 despite continued inflows into mutual funds. 

According to the report, households sold direct equities worth ₹54,786 crore in FY25. In the previous financial year, net sales of direct equities stood at ₹69,329 crore. 

Read More: BHIM Payments App Records 301% Growth in FY26 Transaction Volumes! 

Conclusion  

The updated methodology incorporates additional categories such as equities, Reits, InvITs and AIFs into household savings estimates. The revised data shows higher participation in financial market instruments during FY25. 

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