South India's Investment Landscape Shifts: Gold Reigns, FDs Decline, Stocks Gain Momentum, Finds Way2News Survey

* The Way2News Survey, with ~65,000 respondents across five states, reveals a significant increase in stock market investments; Karnataka leads the way with a remarkable 16% increase

Way2News, a leading hyperlocal news platform, has released the findings of its recent survey titled "How South India Invests". The survey, which gathered data from over 65,000 respondents across 5 states—Andhra Pradesh, Telangana, Tamil Nadu, Karnataka, and Kerala—provides crucial insights into the region's investment habits. 

The survey indicates that gold remains the top investment choice, particularly in Tamil Nadu, where 34% of respondents prefer it over other investment tools. However, there is a notable rise in stock market investments, especially in Karnataka, where 16% of respondents are actively investing in stocks. This highlights a growing trend among South Indian investors who are beginning to see the stock market as a viable and lucrative investment avenue. This shift can be attributed to several factors, including increased financial literacy, the accessibility of online trading platforms, a growing awareness of potential returns, and higher disposable incomes, particularly in southern states where the average per capita income is 5.5 times the national average.

Recently, the Governor of the Reserve Bank of India also highlighted that Indian households are increasingly favouring capital markets over traditional banks for their savings. This observation aligns with the findings of Way2News' survey, which illustrates this rising trend in South India. There has been a significant surge in Demat accounts, with the number reaching 15 crore within a decade, as reported by Motilal Oswal, compared to just 2 crore accounts in 2015 (NSDL). With 3.1 million new accounts being opened monthly, this growth underscores the shift in investment preferences in India towards more dynamic financial instruments such as stocks and mutual funds. Although bank deposits still constitute a significant portion of household financial assets, their share is declining.

Key Takeaways from the survey:

While gold remains a popular investment choice, especially in Tamil Nadu where 34% of respondents prefer it, there is a growing interest in stock market investments across South India. Karnataka leads with 16% of respondents investing in the stock market, followed by Andhra Pradesh & Telangana (14.47%), Kerala (14%), and Tamil Nadu (12%), reflecting a growing recognition of stocks as a wealth creation tool

There is a noticeable decline in traditional fixed deposits, recurring investments, and insurance across states, indicating a shift towards investment options with potentially higher returns. In Andhra Pradesh & Telangana, fixed deposits and recurring investments are at 12.67%, while insurance preferences stand at 8.95%. Kerala shows similar trends with fixed deposits and recurring investments at 14%, and insurance at 7%. Tamil Nadu reports fixed deposits and recurring investments at 13%, and insurance at 7%. Karnataka, with fixed deposits and recurring investments at 10%, and insurance at 9% 

Investment preferences in real estate vary significantly by state, reflecting regional differences -  Andhra Pradesh & Telangana (17.04%), Karnataka (14%), Tamil Nadu (12%), and Kerala (8%)

Mutual funds are favoured highest in Kerala (17%), Karnataka (13%), Andhra Pradesh & Telangana (9.41%), and Tamil Nadu (7%)

Bonds remain a niche investment option with lower interest levels across all states due to fixed returns

Provident funds (PF) and pension schemes are attracting growing interest, particularly in Kerala (11%), highlighting a focus on long-term financial planning and security.

“We are witnessing a clear shift towards diversification and dynamic investment strategies among South Indians. This trend reflects growing financial literacy and a desire for higher returns,” said Raju Vanapala, Founder and CEO of Way2News.

The findings of the Way2News survey underscore a pivotal transformation in the investment landscape of South India. While gold continues to be valued for its cultural significance, the increasing interest in stock market investments and other dynamic financial instruments highlights a maturing investor base. South Indians are not only preserving their wealth through traditional means but are also actively seeking growth opportunities, signalling a robust and forward-thinking investment culture.

About Way2News

Way2News is a leading hyperlocal news platform in India that provides relevant and reliable news coverage extending beyond districts to mandals and villages. The platform aims to inform and empower every Indian with the latest news in real-time, using artificial intelligence to personalize content based on language and preference. By promoting citizen journalism, Way2News aims to foster a more diverse and democratic media landscape by allowing citizens to share news stories from their local area. It combines the power of both human intelligence and artificial intelligence to provide the most relevant news to its users. The app has more than 50 million downloads and close to 13 million monthly visitors. The platform delivers real-time news in eight local languages, including Hindi, Telugu, Tamil, Kannada, Malayalam, Marathi, Bengali, and Gujarati, using advanced technology.