Mumbai, March 17 Retail participation in the government bond market is gradually increasing, with activity in the secondary market witnessing a sharp surge, according to the latest RBI Retail Direct data.
Trading volumes in the secondary market segment have increased by 3.7 times over the past year on the RBI Retail Direct platform, reflecting growing interest among individual investors in government securities, facilitated by easier access through the Retail Direct platform and improved liquidity.
The data showed that the total trading volume on the RBI Retail Direct platform increased to ₹8,211.91 crore as of March 16, 2026, from ₹1,756.08 crore a year ago.
"The most notable development is the sharp increase in secondary market trading 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.
Dated securities of the central government accounted for the bulk of trading volumes at ₹8,059.96 crore, followed by ₹82.23 crore in state government securities, ₹59.95 crore in treasury bills, and ₹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 prioritizing liquidity and visibility over incremental returns.
In the primary market, total subscriptions increased to around ₹8,414.95 crore from ₹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 government securities has been trading at higher levels due to the 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.