NEW DELHI: The assets under management (AUM) of India’s wealth management industry are set to more than double, growing from $1.1 trillion in FY24 to $2.3 trillion by FY29.
This growth will be driven by rising income levels and shifting macroeconomic trends, according to a Deloitte India report.
The report highlights a substantial unmet demand for wealth management services. Of the $1.1 trillion financial wealth held by affluent households in FY24, an estimated $0.4 trillion remains self-managed or informally managed.
By FY29, the financial wealth of these households is projected to reach $2.3 trillion, creating significant opportunities for established firms and new entrants in the sector.
Affluent households, defined as the top 4–5 per cent of households with annual incomes above $25,000, are expected to grow substantially during this period. Alongside rising affluence, there is a clear shift in investment preferences from physical assets like real estate and gold to financial assets such as mutual funds, equities, and portfolio management services.
Mutual Fund growth
Mutual fund AUM has shown robust growth, increasing at an annualised rate of 16.2 per cent from FY17 to FY24 to reach $651 billion. Wealth management firms are leveraging technologies such as data modernisation, cloud infrastructure, and enhanced cyber security measures to improve their offerings and meet evolving customer needs.
“Rising affluence and changing customer preferences are driving unprecedented growth in India’s wealth management industry. However, this competitive landscape demands innovation and adaptability,” said Vijay Mani, Partner – Banking and Capital Market, Deloitte India.
Success in the sector will require a sharper focus on understanding customer needs, tailoring products for varied segments, and adopting hybrid operating models that integrate advanced technology with skilled relationship managers.
Additionally, maintaining strict regulatory compliance will be crucial for sustained growth and profitability, the report emphasised.
The evolving dynamics of India’s wealth management sector signal a promising future, with ample opportunities for innovation and expansion.
