Save as…: A look at how women invest

Before we look at how this plays out in the markets, a quick look back.

Women’s bonds with finance far predate modern banking, of course. Historical records describe women lenders, treasurers and estate managers across centuries and around the world. Chola and Vijayanagara temple inscriptions from south India record women managing endowments and lending jewels. In Tamil Nadu, Chettiar wives and mothers ran the domestic ledgers of sophisticated private banking networks while the menfolk were abroad. In Varanasi and Bengal, widows lent to landlords and traders.

These were not marginal roles.

Then colonialism reared its head; finance was formalised, first under colonial administrations, then under national banking systems. As with so much else formalised at this time — democracy, land rights, medicine — the lens through which such systems were viewed was a purely male one.

One might think: Why does this matter? We’re equal participants now.

The truth is that, as with the office AC — usually set for the male body, which tends to generates heat more easily because of greater muscle mass — subtle cues built into the system make it harder, not by design but certainly by default, for the average woman.

To begin with, for instance, it took fluency in a specific language (usually English) to understand and engage directly with bank accounts and financial instruments. This acted as a primary barrier. Even as recently as 1951, literacy rates stood at 16% for women and 27% for men. Large swathes of women became excluded from modern financial systems.

This seeded the denial of access to high-return assets that lead to compounding wealth.

In India, the legacy of early exclusion still shapes behaviour.

Women save at rates comparable to men, but their savings are concentrated in instruments that prioritise liquidity and security over growth. They enter markets later, with smaller margins for error. They tend to live out their lives without a significant share in appreciating assets (such as businesses and real-estate).

What is dubbed conservative behaviour is a rational response to these circumstances: the cost of financial failure is so high for women — diminished household bargaining power, reputational penalties, a reduced ability to rebuild capital — that they would rather grow their wealth less than risk it all (a very different mindset from that of the archetypal Indian entrepreneur, determinedly leveraging the family gold to take a chance on a dream).

GOLD AS THE FIRST BANK

Coming to gold, for centuries, bullion and jewellery have functioned as a woman’s only asset, relatively insulated from male control.

It has, of course, traditionally functioned as household venture capital, quietly pledged to start or sustain businesses, or sold when hardship strikes. Countless small traders and manufacturers factor it in as the family’s backstop. Numerous Indian conglomerates began on the strength of a woman’s gold bangles.

When India itself needed to dig deep, during the freedom struggle, this gold helped move things along. A large share of the ₹1 crore that Mahatma Gandhi raised for the Tilak Swaraj Fund in 1920-21 came via jewellery donated by women.

A lot has admittedly changed over the past century.

After independence, India dramatically expanded banking access, culminating in the Jan Dhan Yojana financial inclusion programme launched in 2014.

Today, more than four in five women have a bank account. Digital payments, microcredit and mutual funds have expanded their formal presence in the system.

Yet the gap between access and agency persists, and is visible across banking and investment products. Women are over-represented in savings accounts, fixed deposits, post-office schemes and insurance-linked products. They are under-represented in equity, direct market participation, and higher-yield assets (particularly businesses and real-estate).

Women do now account for roughly a quarter of retail borrowers in India. They also default less. But average loan sizes and credit limits remain lower than for men—and interest rates issued tend to be higher.

How does this happen?

It reflects underwriting models that essentially still penalise the way the average woman’s life plays out: with interrupted careers, non-linear incomes and thinner credit histories.

SAFE, UNSOUND

The cost to these investors is significant.

Over the past decade, bank deposits have delivered near-zero real returns (after inflation and tax), while diversified equity portfolios have compounded at materially higher rates. A ₹1 lakh investment in 2015 would now be worth ₹1.8 lakh in a fixed deposit and about ₹3.1 lakh in equities.

Women make up about 24% of mutual-fund investors and hold roughly 33% of individual assets under management, a share that has grown rapidly since 2019, according to the Association of Mutual Funds in India (AMFI). But they remain a minority in direct-equity ownership, with fewer than one in five demat accounts held by women.

A focus on low-yield instruments perpetuates a persistent wealth gap.

THE CONFIDENCE GAP

Much of this divergence originates within the household.

In most homes, women manage liquidity (cash, fixed deposits, insurance, gold) while men own the growth assets (equity, property, business capital).

Even modern entrepreneurship rests on an unspoken safety net: founders are able to leave salaried jobs and pursue high-risk, high-reward ventures because a spouse — often the wife — continues to provide a stable income, benefits, and financial continuity for the household.

What this proves… is interesting.

Across countries and asset classes, the most robust behavioural asymmetry is not female risk-aversion but male overconfidence.

Take just one instance: men trade more frequently, and rebalance portfolios more aggressively. Portfolio turnover among male investors is typically 30% to 50 % higher than among women. Research from Hiroshima University’s School of Economics indicates that women are also less likely to panic-sell during a market crash.

Such data is frequently cited as evidence of conservatism among women, but a more accurate characterisation is cautious rationalism, because financial loss carries higher downstream costs.

The question is not how to persuade women to behave differently, but how to redesign financial products and services so that sound female financial logic — liquidity awareness, long horizons and resilience — earns comparable returns.

Product framing matters as well, and this offers a clear indication of what women seek.

When investments are framed around goals such as retirement security, downside protection and income continuity, the gender gap narrows sharply, studies have found. When investments are presented as abstract return-maximisation exercises, participation skews male.

Speculation offers the clearest contrast. Men dominate in high-volatility assets such as cryptocurrency, leveraged derivatives and short-term trading strategies.

The uncomfortable reality for the investment industry is that many behaviours labelled “female risk aversion” align closely with best practices for the investor: lower turnover, diversification, patience, and resistance to noise. The very traits that are also foundational to long-term wealth creation.

SYSTEMS ERROR

Technology has thankfully eased matters somewhat, in terms of access.

App-based onboarding, low minimum investments and automated products have enabled millions of Indian women to enter formal finance without gatekeepers.

Mutual-fund platforms, robo-advisors and digital brokers allow women to invest on their terms without the social friction that often accompanies face-to-face interactions. (Ask around and women will tell you stories of being asked: Who manages this account with you? Who will be making the final decision; can we speak to Sir?)

With fintech, problems emerge downstream. Algorithms operate as they are trained to, and leverage historical data. Employment gaps, income volatility, thinner credit files, interrupted careers and joint financial arrangements — features that are more common in women’s lives — are still interpreted as indicators of risk.

Credit provides a clear illustration of the impacts of this. Across markets, women are offered smaller loans, lower credit limits or less favourable pricing. Eliminating gender as a parameter does not solve this. Ironically, in some cases, it worsens outcomes by preventing the model from recognising women’s historically better repayment behaviour.

All this creates feedback loops. Smaller loans generate thinner repayment histories, which justify smaller loans in the next cycle. What was once a slow, interpersonal bias becomes an automated vicious cycle, replicated at scale.

THE APPLE DOESN’T FALL…

The Apple Card controversy in the US made this dynamic visible.

In 2019, multiple households reported that the card, issued by Goldman Sachs and managed algorithmically, granted men credit limits that were dramatically higher than the limits granted to their wives, despite shared incomes and assets.

Investigations found no explicit use of gender. The model evaluated individuals separately. Many women had spent years as authorised users on family cards rather than primary borrowers. Their repayment histories existed, but they didn’t “count”.

Regulators cleared the issuer of intentional discrimination. Ultimately, the product was redesigned. Joint credit lines and family accounts were introduced, allowing spouses to pool histories and build credit together.

The lesson here is clear: Neutral code, when operating on non-neutral histories, will produce non-neutral results.

FUTURE-PROOF

What does this mean for the future of women and financial markets?

Technology tends to amplify the baselines it inherits.

In India, the stakes are high. Fintech is onboarding first-time investors at unprecedented scale. If models are trained on data that reflect male-default financial paths, inequality will be digitised and normalised before it is noticed.

Which brings us to the big questions: Where do we go from here? What would financial services need to look like, in order to accommodate the average life trajectories of mothers, wives and caregivers?

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FIXING THE ONE-SIZE-FITS-MEN APPROACH

The finance industry’s default response to the gender investment gap has been “education”.

Teach women more. Nudge them harder. Encourage “confidence”. This approach misidentifies the constraint. The issue isn’t knowledge or intent, but product design.

Modern financial products are built around an assumed profile: a continuously employed individual with an uninterrupted career arc and predictable growth (in earnings, assets and net worth). Women’s economic lives are more likely to be discontinuous. Career breaks for caregiving and phases of part-time work increase the likelihood of income volatility.

A woman-friendly product, in such a world, is not one marketed in bright hues of pink. It is one whose rules adapt to these realities.

What this large and increasingly wealthy market needs is products that do not penalise interruptions in growth and earnings, and do more to recognise and reward low rates of default.

Contribution systems must allow pauses and catch-ups. Pension products must accommodate non-linear accumulation. Insurance must price continuity over the life course, not over narrow employment windows.

Flexibility would need to become the foremost design principle.

LIVE LONG AND PROSPER

There are other, also-significant, ways in which the tilt could be corrected.

Women live longer than men, on average by several years. But most retirement products implicitly assume a post-retirement horizon of about two decades. For many women, the horizon is closer to 25 or 30 years.

Without built-in longevity protection (through annuitisation options, or deferred income streams) women face a higher probability of outliving their savings even when they met all the other criteria. Products that fail to account for this systematically under-serve women, while appearing neutral.

Documentation systems remain another hidden barrier. Name changes after marriage, joint-to-individual transitions and changes in guardianship frequently disrupt financial continuity. These are not edge cases. They are predictable life events for a significant share of women. Products that cannot absorb them without friction restrict participation.

BETTER FOR US ALL

Behavioural design matters too.

Standardising advice, reducing fee opacity, and aligning compensation with long-term outcomes would benefit women. This would finally acknowledge the fact that the average woman follows a path that is no less valid than the average man’s but is certainly very different from it.

If greater participation and better outcomes for women aren’t inducement enough (though they should be), we should make the shift for the good of us all.

Products designed to better suit women’s lives tend to improve outcomes universally.

When finance assumes uninterrupted accumulation, it fails everyone who lives with volatility: gig workers, entrepreneurs, caregivers, those in cyclical industries. Women just make the flaw more visible.

Flexibility, portability, transparency and longevity protection are not gendered features. They are simply good design.

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RUNNING THE NUMBERS: GENDER GAPS AND GAINS

* 89% of adult women in India have a bank account

* Women account for 33% of individual mutual fund assets under management

–24% of unique mutual-fund investors

–22% of retail equity investors

– 19% of demat account holders

* 18% of India’s start-ups have women founders

* 3% of overall loans availed by women borrowers are for business purposes

*13% of women are land owners

Appreciating assets are disproportionately in male names

* Women make up about 15% to 25% of income-tax filers

* A majority of women hold liquidity (fixed deposits, recurring deposits, post-office schemes, gold) while men hold growth assets (equity, property)

The impact of this is significant. For comparison, over a 10-year-window

– ₹1 lakh invested in a fixed deposit would now be worth ₹1.8 lakh

– ₹1 lakh invested in equities would be worth about ₹3.1 lakh

(Sources: World Bank Global Findex Database 2025; Association of Mutual Funds in India (AMFI) reports, 2024; National Stock Exchange (NSE); Ministry of Statistics and Programme Implementation; Women in India Startup Ecosystem Report 2023; Niti Aayog, National Council of Applied Economic Research (NCAER); State Bank of India Ecowrap; Central Board of Direct Taxation)

(Kashyap Kompella is a CFA charterholder, tech industry analyst and author of three books on AI)