FDs more popular than MFs, equities: Sebi

More than 95% Indian households prefer to park their money in bank deposits, while less than 10% opt for investing in mutual funds or stocks, a new Sebi survey showed on Wednesday.

The survey, conducted across urban and rural areas of the country, showed that life insurance was second most preferred investment vehicle, followed by precious metals, post office savings and real estate in the top-five.

Mutual funds came at sixth place (9.7%), followed by stocks (8.1%), pension schemes, company deposits, debentures, derivatives and commodity futures (1%) as investment vehicles for the urban households.

Among the rural households, not even 1% of the survey respondents were investors, while even the awareness about mutual funds and equities was dismal at just 1.4%.
However, 95% of rural survey respondents had bank accounts, 47% life insurance, 29% post office deposits and 11% saved in precious metals.

On a positive note, the survey found the investor base in India is increasing as nearly 75% of the investors in the Sebi Investor Survey 2015 participated in the securities markets for the first time within the last five years.

The survey was commissioned in the year 2015 and got completed last year, while its results were released on Wednesday by the capital markets regulator. Nielsen, a global leader in primary research, has conducted and analysed this Sebi survey.

The last survey was conducted in 2008-09. Sebi said the survey first listed a set of 2,04,694 households and basic information about demographics, income, savings and investments were collected.

In the second step, a subset of 50,453 amongst these listed households were chosen to conduct the final survey.

The data was used to create an estimate of the total number of investing households at the end of 2015.