As bank fixed deposit (FD) rates moderate and investors look beyond traditional savings instruments, bonds are emerging as a preferred avenue for generating stable income and diversifying portfolios.
Improved digital access, greater regulatory oversight and rising awareness are accelerating retail participation in the bond market.
Reflecting this shift, online bond platform Jiraaf has recorded nearly 15x growth over the past two years, with the average investment size crossing Rs 1.5 lakh, signalling that investors are making meaningful allocations rather than merely experimenting with the asset class.
In this edition of ETMarkets Smart Talk, Vineet Agrawal, Co-founder of Jiraaf, discusses why bonds are becoming a permanent part of Indian portfolios, the financialisation of fixed income, how investors should evaluate yields, and why diversification within fixed income is becoming increasingly important in a falling interest-rate environment. Edited Excerpts –
Q) As fixed deposit rates moderate, many investors are moving towards bonds and alternative fixed-income products. How do you see the trend taking shape?
A) As the economy matures and interest rates moderate, investors are beginning to reassess traditional fixed-income choices. A one-year FD that offered around 8.5% in 2015 is now closer to 6.9%, a decline of nearly 160 basis points over the decade. For investors, this means post-tax returns may not always keep pace with inflation or long-term financial goals.
This is where government bonds and investment-grade corporate bonds are gaining relevance. Investors are not necessarily moving away from FDs completely, but they are realizing the need to diversify within fixed income. A part of the portfolio is now being allocated to bonds and other regulated fixed-income instruments that can offer better return potential while helping investors balance risk, liquidity, and maturity.
Q) Industry data suggests retail participation on online bond platforms has grown sharply in recent years. Please share numbers. How has your platform grown?
A) Retail participation in bonds has grown meaningfully as awareness, digital access, and regulatory oversight have improved. Online Bond Platform Providers have made it easier for individual investors to evaluate, compare, and invest in bonds more transparently.
At Jiraaf, we have seen nearly 15x growth over the last two years, reflecting rising interest among retail investors in fixed-income products beyond traditional deposits. The average ticket size per investment is now upwards of ₹1.5 lakh, indicating that investors are allocating meaningful sums to this asset class rather than treating it as a trial investment.
This gives us confidence that bonds are gradually finding a more permanent place in Indian portfolios, especially among investors seeking fixed returns, defined maturities, and regular payouts.
