IANS | 29 Nov, 2023
Greater financial literacy, frictionless customer onboarding and
proliferating user-friendly digital platforms have led to a substantial
jump in the number of young investors, accounting 70 per cent–80 per
cent of active clientele of digital/discount brokers within the 18-30
years age group, according to Bain & Company’s latest study of the
Indian Retail Brokerage market.
Similarly, 70 per cent–75 per cent
of newly acquired customers for bank brokers are also below the age of
30, albeit with lower activation rates.
The industry also saw a
leap in investor engagement from Tier 2+ cities, which now account for
one-third of the cash turnover, the study said.
The Indian retail
brokerage industry has witnessed remarkable growth, nearly doubling
industry revenue from Rs 14,000 crore in FY19 to Rs 27,000 crore in
FY23, representing a CAGR of approximately 17 per cent.
This
growth has been fueled by the emergence of India’s mass-affluent and
affluent segments, coupled with increasing financial literacy.
The
number of demat accounts has tripled since FY19, reaching an impressive
tally of 115 million in FY23, thanks to the heightened interest sparked
by the Covid-19 pandemic.
These are among the findings from Bain & Company’s latest study of the Indian Retail Brokerage market.
The
Covid-19 pandemic served as a turning point for retail participation in
capital markets, with digital-first players revolutionising the
industry.
However, the industry’s average revenue per user (ARPU) decreased from around Rs 6,000 in FY19 to Rs 5,000 in FY23.
