According to market participants, the participation of retail investors in the bond market increased after the regulator’s decision from June 2024 to lower the minimum investment threshold.
About $3 billion a year comes purely from retail bond investors, said Nikhil Aggarwal, founder and chief executive of Grip Invest Group, a bond platform. The segment is growing at around 300% annually, Aggarwal said at the Mint India Investment Summit held in Mumbai.
Securities and Exchange Board of India (Sebi) made access to corporate bonds easier by reducing the minimum investment ticket size from ₹1 lakh up to ₹10,000 in June 2024.
The average bond investment size is now ₹50,000-60,000, according to Aggarwal. Investors transact on the Grip platform at least eight times a year, with half of users now coming from the top 15 cities, he said.
Retail participation in the bond market was less than 2% in FY22, a trend seen globally as well, Niti Ayog said in a December report.
In more developed markets such as China, retail participation is encouraged through exchange-traded bonds, online bond trading platforms and simplified access points. In the US, retail investors can more easily access bonds through mutual funds, ETFs and regulated broker-dealer platforms, ensuring greater inclusion, the report said.
Bond Acceptance Technology
According to Vineet Malhotra, co-founder and CEO of Compoundexpress, technology will play a big role in bringing bonds and fixed income to more people, allowing them to simulate their portfolios and understand how bonds will play out in them.
in India mutual fund distributors only sell mutual fund schemes, Malhotra said. “We need to enable more products for these advisors and make MFDs private bankers for their clients. The point is that these products should be available to a lot more people.”
Bonds are a small part portfolios of retail investors compared to mutual funds. Retail participation could deepen further if asset managers or mutual fund distributors start offering a bouquet of bonds to their investors.
According to a January 2025 Deloitte report, the wealth of affluent households is expected to grow to $2.3 trillion by FY29, creating significant opportunities for both established players and new entrants in the sector.
According to Dipak Dag, head of strategy and investor relations at Jio Financial Services, wealth management in India has largely catered to ultra-high-net-worth and high-net-worth investors. “Technology has now made the middle and mass affluent segments viable. As the country grows, India cannot sustain 8-10% growth in the next 10-15 years without the entire pyramid seeing income growth.”
