India's post-pandemic consumption surge, driven by easy loans, is losing momentum as household savings plummet to a six-year low.
Net financial savings fell to 5.3% of GDP in FY23, well below the 7.6% historical average, according to RBI data. While gross savings rose, household debt skyrocketed by 30% annually between FY21 and FY23, fueled by fintechs and NBFCs. Analysts warn that weak job growth and high borrowing costs are straining finances, with spending unlikely to recover soon. Automation and economic slowdowns further pressure India's consumption-driven economy.