How much do Indians save in FDs? All India average is Rs 4.25 lakh

This article has been updated to correct some calculation errors.

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Fixed deposits are the most preferred investment choice for investors to park their excess funds, and on an average Indians save Rs 425,725.54 in FDs, according to data compiled by BankBazaar. 

Amongst all the states in India, Delhi leads in terms of the amount saved on an average in a fixed deposit at Rs 8,08, 723 followed by Maharashtra at Rs 7,32,059 and Mizoram at Rs 6,84,231

In total, India currently has Rs 103 trillion saved across 24.23 million deposits.

However, in terms of total deposits,  Maharashtra has the highest amount of Rs  25.14 trillion in deposits, followed by Delhi NCR at Rs 10.97  trillion and Karnataka at Rs 8.17 trillion, as per RBI's quarterly deposit data, analysed by BankBazaar.

Tamil Nadu occupied the fourth place at Rs 6.57 trillion, followed by Uttar Pradesh at sixth position with Rs 6.56 trillion. West Bengal came in at seventh with Rs 5.91 trillion in deposits and Gujarat at eigth place with Rs 5.68 trillion. ( See chart below) 

"The substantial average deposit amounts in states like NCT of Delhi followed by Maharashtra are much higher as compared with other states in the country. The average deposit amount in Delhi NCR alone is over  Rs 8 lakh, followed by Maharashtra where the average is slightly over Rs 7.3 lakh. States in the south weigh heavily on both volumes and averages, while states in the north east like Mizoram and Sikkim are punching above their weight in terms of averages," said Adhil Shetty, CEO of Bankbazaar.

 

The data suggests that Delhi accounts for around 10% of all deposits by volume in India. Maharashtra has another 25%. 

"The above data also shows that Indians love Fixed Deposits (FDs) and this trend continues even today despite ups and downs of interest rates in the past. It is seen that Indian senior citizens and risk averse investors opt for FD," added Shetty.

An overwhelming 69 per cent of all households in India have saved in banking instruments while barely 4 per cent of the country’s households save in post office, revealed a survey conducted by the People Research on India’s Consumer Economy (PRICE) an independent, not-for-profit think tank.

The reason for FDs being preferred choices are safety from market volatility, simplicity, and rising interest rates, finds a study by Kuvera, an online wealth management platform. 

Typically, FDs  are  risk-free and give guaranteed returns.

"Fixed deposits offer a guaranteed rate of interest, which is usually higher than regular savings accounts. This provides stability and ensures that the money invested will earn a fixed return over a specified period. FDs can be opened easily with minimal documentation at any bank or financial institution. They are considered hassle-free investment options, making them accessible to a wide range of individuals," said Adhil Shetty, CEO of BankBazaar.

A survey by investing platform Kuvera earlier this year revealed that almost half of the 1.6 million investors who responded said they chose FDs when they needed money within 3 years with safety. This would be 44% of the total respondents to the survey noted. Another 23% chose FDs to park emergency funds to beat inflation. Around 12% of investors preferred an FD for its simplicity and familiarity and one in 10 invested in an FD for safety from market volatility.