New Delhi, Dec 23
India’s savings rate has surpassed the global average as financial inclusion has shot up in the country with over 80 per cent adults now having formal financial accounts, according to an SBI report released on Monday.
India savings rate is at 30.2 per cent, which is higher than the global average of 28.2 per cent, the report stated.
“Due to various measures, India’s financial inclusion improved significantly and now more than 80 per cent of adults in India have a formal financial account, compared to about 50 per cent in 2011, which is improving the financialisation of the savings rate of Indian households,” the report points out.
The share of net financial savings in total household savings has increased from 36 per cent in FY14 to about 52 per cent in FY21, however, during FY22 and FY23, the share has decelerated.
FY24 trends reveal that the share of physical savings have again started to decline.
Among financial savings, the share of bank deposits/currency is declining as new avenues of investment like mutual funds etc. are emerging, the research report from the State Bank of India’s Economic Research Department stated.