MONEY
Household savings slip for the third year in a row to 18.1% of GDP in FY24
- IBJ Bureau
- Jun 16, 2025
India’s household savings have slipped to a new low for the third consecutive year, falling to 18.1 per cent of GDP in FY24, according to a report by CareEdge Ratings.
On the other hand, household debt rose to 6.2 per cent of GDP, almost twice as much as ten years ago, showing that more Indians are borrowing to meet their everyday needs, the report adds.
The report also points to a wider dip in gross domestic savings, which dropped to 30.7 per cent of GDP in FY24, down from 32.2 per cent in FY15.
Despite the worrying decline in savings, the report notes a more promising outlook in rural India. Wage growth for rural male workers rose by 6.1 per cent year-on-year in February, marking the fourth straight month that earnings outpaced rural inflation. Easing food inflation and healthy agricultural prospects are also helping boost rural consumption.
“Going ahead, RBI policy rate cuts, lower tax burden and continued easing of price pressures remain key tailwinds for the broad-based demand recovery,” CareEdge has said in the report.
Rural consumer confidence is showing cautious optimism, holding steady near the neutral 100 mark. Meanwhile, urban consumer sentiment remains subdued, although expectations for the year ahead remain hopeful across both rural and urban households.
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