Retail participation in G-Secs picks up; secondary market volumes jump 3.7 times in a year: RBI data

Mumbai: Retail participation in the government bond market is gradually gaining traction, with secondary market activity witnessing a sharp surge, according to the latest RBI Retail Direct data.

Traded volumes in the secondary market segment have risen 3.7 times over the past year on the RBI Retail Direct platform, reflecting growing interest among individual investors in government securities, supported by easier access through the Retail Direct platform and improving liquidity.

Data showed that total traded volume on the RBI Retail Direct platform increased to Rs 8,211.91 crore as on March 16, 2026, from Rs 1,756.08 crore a year ago.

"The most notable development is the sharp increase in secondary market traded volume. This indicates that retail investors are slowly becoming more comfortable trading government securities rather than limiting themselves only to primary subscriptions," said Venkatakrishnan Srinivasan, founder and managing partner of Rockfort Fincap LLP.

The central government dated securities accounted for the bulk of trading volumes at Rs 8,059.96 crore, followed by Rs 82.23 crore in state government securities, Rs 59.95 crore in treasury bills, and Rs 9.77 crore in sovereign gold bonds.

The RBI's Retail Direct scheme helps individuals invest in government securities through a direct platform.

Srinivasan noted that the relatively lower participation in state government securities is surprising, given that state development loans typically offer a yield spread of 0.50-“0.80 per cent over comparable G-Secs, indicating that retail investors may be prioritising liquidity and visibility over incremental returns.

In the primary market, total subscriptions increased to around Rs 8,414.95 crore from Rs 6,245.18 crore in the year-ago period, with treasury bills accounting for the largest share, reflecting investor preference for shorter-tenor and simpler instruments.

In the last few weeks, the yield on the government securities has been trading on the higher side due to conflict in the Middle East, which led to a sharp surge in crude oil prices in the international market, posing a threat to imported inflation.

Currently, the 10-year benchmark bond yield is trading at 6.7118 per cent.