The shift: Households turn net borrowers from banks, says BCG report

While household deposits as a percentage of gross domestic product (GDP) came down to 4.1 per cent in 2023 from 6.1 per cent a decade back, borrowings by them during this period moved up from 3.3 per cent to 5.8 per cent, according to a report by management consultancy BCG. The report highlighted that unsecured lending as a proportion of GDP in India is as high as it is in the United States. Meanwhile, the report indicated that households are increasingly shifting from physical to financial assets, and bank deposits are ceding space to pension, small savings, insurance, and capital market.