SIPs in treasury bills to aid more retail participation

Operational Ease to Ensure Traction

- Christina Titus & Ananya Grover

The almost 0.5-million-strong retail investors in government securities (G-Secs) are set to get a new option – the systematic investment plan (SIP) route – to participate in the government bond market. Experts believe that this move can also bring better traction towards the government securities market, provided the operational part is easy.

Treasury bills (T-bills) are short-term government securities with tenure of up to one year, which are available at a discount and redeemed at face value. It offers investors efficient cash management with greater returns compared to bank deposits, according to experts.

Data show that treasury bills constituted 68% of the primary market subscriptions as of August 4. Investments in T-bills were ₹4,748.51 crore as on August 4, compared with ₹3,457.63 crore a year ago – a rise of 37%. The number stood at ₹1,679.37 crore in 2023.

According to Anurag Mittal, head of fixed income at UTI Mutual Fund, "A lot of people are looking for safer options for short-term cash deployment needs, especially with the rates on savings accounts coming down."