India's financial assets & liabilities logs strong growth in FY24: RBI

India's financial assets and liabilities expanded at a robust pace in 2023-24, supported by strong economic growth, rising household savings, deeper financial intermediation and healthier sectoral bal

India’s financial assets and liabilities registered a strong growth of 13.9 per cent and 12.7 per cent, respectively in the financial year 2023-24, reflecting robust economic growth, high financial intermediation, and deepening linkages among institutional sectors, according to a study by Reserve Bank of India (RBI).

 

Households expanded their asset base through deposits, insurance, and equity investments, the study, authored by RBI’s staff, stated in the January bulletin.

 

It added that financial corporations continued to play a pivotal role in mobilising and allocating resources, with notable growth in loans and advances, and debt securities, reaffirming their central role in financing the growth of the domestic economy.

 

Financial corporations and households being in surplus continued to remain as the net lending sectors to the rest of the economy.

 

According to the study, the general government’s fiscal consolidation, alongside improving corporate financial balance sheets, contributed to healthier sectoral net positions and an overall rise in net financial wealth to 28.6 per cent of GDP.

 

India’s financial interactions with the rest of the world strengthened during the year, driven by both inflows and outflows, despite multiple global uncertainties.

 

Overall, the financial accounts of FY24 highlights a robust and resilient financial balance sheet of domestic sectors supported by strong macroeconomic fundamentals and deepened financial intermediation, the study said.