DBS Bank India and rating agency CRISIL’s "Women and Finance" study highlights how Indian women's financial choices are evolving. The study concluded that women in India have a preference for low-risk Fixed Deposits, showcasing a need for stability and security.
In the dynamic landscape of Indian finance, a discernible trend has emerged, highlighting the financial intelligence and smart investment decisions made by Indian women. A growing proportion of Indian women are exhibiting an inclination for low-risk financial instruments, with Fixed Deposits (FDs) being a particularly popular option.
The deliberate choice made by Indian women to give stability and security a higher priority in their financial portfolios is reflected in this change in the investing approach.
Why FDs?
Indian women are increasingly opting for Fixed Deposits (FDs) due to their reliability, predictability, and assured income stream, recognizing the importance of financial security.
Fixed Deposits in India are attractive to women investors due to their risk-averse nature, guarantee of return, and simplicity. These deposits align with financial goals and risk tolerance levels, making them accessible to a diverse range of Indian women, contributing to the growing financial empowerment narrative in the country.
Women and Finance Study
These findings come from a study by DBS Bank India and rating agency CRISIL, based on the financial planning, prioritization, and management practices of urban Indian women. The "Women and Finance" study, which covered ten Indian cities, over 800 women were surveyed on a variety of topics about their financial decision-making, goal-setting, saving and investing habits, use of digital tools, and preferences for various banking products.
98 per cent of Indian women who work for themselves or are salaried actively participate in long-term family decision-making, according to the study. The report offers a captivating look at the increasing empowerment of working-class metropolitan women.
Evolving Priorities with Age
The main long-term financial priority of a woman in India changes as she gets closer to her retirement age. For individuals between the ages of 25 and 35, purchasing or renovating a home is of the highest priority. For those between the ages of 35 and 45, it shifts to children's education, and for those over 45, it becomes medical care. The survey also showed that only 7 per cent of women invest in stocks, 51 per cent of them favor low-risk financial services like savings accounts and fixed deposits, followed by 16 per cent in gold, 15 per cent in mutual funds, and 10 per cent in real estate. DBS Bank India's customer insights show that 10 per cent of female customers acquire an active fixed deposit, while only 5 per cent of male customers have an FD.
Dependents significantly influence women's investment behavior, as the report states 43 per cent of married women have dependents who invest around 10 to 29 per cent of their income whereas those married women who do not have dependents invest nearly half of their income.
Understanding Women’s Borrowing Patterns
Hyderabad and Mumbai are the top cities for credit card usage, with 96 per cent of Mumbai women relying on them, compared to 63 per cent in Kolkata. 18 per cent of working women avoid credit cards due to trust issues, overspending, and hidden fees. Only 14 per cent of them prefer cash transactions, while 29 per cent prefer UPI, 16 per cent mobile banking, 13 per cent credit cards whereas 11 per cent use net banking. A smaller percentage prefers debit cards and digital wallets.
Home loans are the major loans taken by salaried women, however, half of them have never opted for a loan. 55 per cent of women mentioned they should have enough personal savings, high interest rates, or strict repayment terms as reasons. 95 per cent of Urban Women who belong to East India mainly Kolkata prefer public sector bank account ownership. In South India, more than 40 per cent of women prefer public sector banks, whereas less than 30 per cent do so in Bengaluru and Chennai. 75 per cent prefer email, WhatsApp, and SMS to interact with banks in case of any inquiry.
UPI is preferred by urban women for various payment needs, including money transfers, utility bills, and e-commerce purchases, with 33 per cent under the age group of 25-35 using it for online shopping and above 45 age group making up 22 per cent.
Contributions to Decision-making
The report further shows that 98 per cent of Indian women, both salaried and self-employed, actively participate in family decision-making, with 47 per cent making independent financial choices. Women over 45 lead the way resulting in 65 per cent and women aged between 25-35 results 41 per cent making independent financial choices.
These finds indicate the evolution of women’s relationship with finance. No longer are Indian women taking a backseat when it comes to earning money, investing money and borrowing money. They are the decision-makers and creators of a bright future for the country, community and their families
