The Gender Investment Gap in India: A Problem of Access, Not Ability: Part 1
Introduction
Investing behaviour differs significantly between women and men, with numerous studies highlighting a persistent gender investment gap. In India, only 1 out of 5 investors is a woman despite increasing financial inclusion programmes aimed at women. While women’s workforce participation rates have been increasing (though slowly) as well as wealth accumulation among women, their investment activity still lags behind that of men.
This gap is not due to a lack of ability or confidence but due to structural barriers such as limited financial literacy, societal norms and restricted access to investment opportunities. The issue is not that of risk aversion but of exposure to risk, where women are conditioned to prioritise savings over investment. This article explores the reasons for this disparity and how financial literacy, systemic reforms and more robust inclusion strategies can help bridge the gap.
Breaking the Myth of Confidence Gaps
One of the most common explanations for women’s lower participation in investing is gender stereotypes—that women are more risk-averse or lack financial confidence. Research suggests otherwise. Women are equally capable of making sound investment decisions and in many cases, demonstrate better financial discipline and acumen than men.
Research shows that women take a careful approach, which leads to more cautious trading and investing for the long term, which can yield significant returns over time. Furthermore, women trade less frequently than men and conduct more thorough research before making investment decisions. This disciplined and thorough approach helps women avoid knee-jerk reactions and impulsive decision-making, leading to more successful asset allocation.2
According to the Axis Mutual Fund Study (2024), women investors exhibit greater commitment and long-term focus in mutual fund investments. It finds that women invest 25% more per person compared to men, demonstrating a stronger financial commitment. Women also display 22% higher five-year persistence, reinforcing their preference for steady, long-term investing over short-term speculation. Furthermore, the average investment corpus held by women is 37% higher, further underlining their disciplined and goal-oriented investment approach. These trends only challenge traditional stereotypes about women being risk-averse investors, instead showcasing their strategic and consistent investment behaviour.3
The Real Barriers
1. Financial Literacy Gap
A major barrier to women’s investment participation is low financial literacy levels. The National Financial Literacy and Inclusion Survey found that only 21% of Indian women are financially literate, compared to 29% of men. According to our study with KAS’s, ‘ Bridging the Gender Gap’4, 74% of the primary survey respondents said that they have received guidance/advice/ training to handle finances; most have relied on their parents/in-laws and/or spouses, rather than on formal education (33%) or professional financial advisors (25%). This dependence on family for financial guidance rather than formal education or professional advice restricts, limit their active role in investment planning and wealth creation. Without structured financial education, women remain on the periphery of the investment ecosystem.
The consequences of this disparity extend beyond individual households, reinforcing systemic inequalities in employment, entrepreneurship and asset ownership. Addressing financial literacy gaps from an early age is crucial and integrating financial education into school and college curricula can equip women with essential skills in budgeting, saving, investing and debt management.
2. Traditional Societal Expectations
In India, cultural and societal norms have long influenced financial behaviours, with men traditionally acting as primary earners while women manage household expenses. These expectations extend to investment decisions, where women exhibit a preference for traditional, low-risk financial instruments. According to the Axis Mutual Fund Women Investment Behaviour Report (2024), women primarily invest in fixed deposits, gold and real estate, with only 29.5% of traditional asset investments attributed to them. Their participation in non-traditional assets, such as mutual funds, direct equity and start-ups, is even lower at just 17.7%, compared to 82.3% for men.5
While these traditional instruments offer stability, they often do not generate wealth at the same rate as equities or mutual funds. As a result, women accumulate significantly less wealth over time. According to the Asia-Pacific Global Gender Wealth Equity Index (2022), women globally accumulate only 74% of the wealth that men do by retirement. In India, this gap is even wider at 64%, largely due to gender pay disparities, slower career progression and financial literacy gaps.6 Encouraging women to explore diversified investment options and bridging financial literacy gaps is essential to narrowing this wealth divide and ensuring long-term financial security.
3. Legal and Inheritance Barriers
While India’s inheritance laws are generally equal, social norms prevent distribution of wealth equally to daughters, directly impacting their wealth accumulation abilities. These norms have historically favoured men, often leaving women with limited financial assets. While legal reforms have improved inheritance rights for women, cultural barriers still prevent them from claiming or managing inherited wealth actively. Additionally, many women lack awareness of estate planning, wills, and financial instruments that could help secure their financial future. Increasing legal literacy and financial independence through estate planning awareness can empower women to take control of their wealth.
Addressing these challenges through targeted education, inclusive financial policies and greater digital access can empower more women to take control of their wealth, ultimately bridging the gender investment gap and fostering financial independence.
Part 2 of this article will delve into the key investment risks women face and explore strategies to bridge the gender investment gap.
1 “Gender Disparity: Out of 5 Investors in India, Just 1 Is a Woman, Study Shows.” Business Today, 8 Mar. 2022,
https://www.businesstoday.in/latest/corporate/story/gender-disparity-out-of-5-investors-in-india-just-1-is-a-woman-studyshows-325123-2022-03-08.
2 “Women’s Day 2023: Rise in Female Investors!” Teji Mandi, 8 Mar. 2023, https://tejimandi.com/blogs/feature-articles/womensday-2023-rise-in-female-investors. (Teji Mandi is a SEBI-registered subsidiary of Motilal Oswal Financial Services)
3 Axis Mutual Fund Women Investment Behaviour Report (2024) accessed from
https://www.advisorkhoj.com/resources/images/news/Women-Investment-Behaviour-Report-2024/Women-InvestmentBehaviour-Report-2024.pdf
4 Bridging the Gender Gap: Work, Wealth, Welfare, and Well-being for Women https://www.kas.de/en/web/japan/single-title/-
/content/bridging-the-gender-gap
5 Axis Mutual Fund Women Investment Behaviour Report (2024) Accessed from
https://www.advisorkhoj.com/resources/images/news/Women-Investment-Behaviour-Report-2024/Women-InvestmentBehaviour-Report-2024.pdf
6 “2022 Global Gender Wealth Equity Report.” WTW, https://www.wtwco.com/en-us/form-thank-you/2022/11/hwc-igs-gbl-gblwgc-20221103-2022-global-gender-wealth-equity-pg10185a1-03-lp-gated-confirmation