New Delhi [India], October 24 : The Government Securities (G-Sec) market has witnessed substantial growth over the past five years, expanding from Rs 769 lakh crore in calendar year (CY) 2019 to Rs 1,812 lakh crore in Calendar Year (CY) 2024, according to the Reserve Bank of India's Payment Systems Report for the half year ended June 2025.
"Government Securities (G-Sec) market has experienced notable expansion from a value of Rs 769 lakh crore in CY 2019 to Rs 1,812 lakh crore by CY 2024. Transaction volume also increased from 13.76 lakh in 2019 to 17.6 lakh in 2024. During H1 2025, 9.85 lakh transactions with a total value of Rs 994 lakh crore had been processed." Noted RBI Payment system report released on Thursday.
According to the RBI's report, an increase in transaction volume reflects continued momentum in trading activities and investor participation.
Government securities are tradable debt instruments issued by the central or state government to raise money for public spending. These are considered low-risk investments because they are backed by the government's "sovereign guarantee".
They are typically fixed-income investments that provide a regular income stream and return the principal amount at maturity.
In India, G-Sec Bonds are debt instruments issued by the Reserve Bank of India (RBI).
The government sells the bonds and uses the funds to pay for daily projects, special infrastructure, or military operations. In exchange for investing in the bond, the issuer promises to pay back the principal amount on a predetermined day. Additionally, the issuer also pays a special G-Sec interest rate till that day.
The most alluring part of G-Sec Bonds is the fact that their credit risk is negligible. As they are government-backed, there is no chance for them to default on the repayment. G-Sec Bonds can also be traded in the secondary markets, giving investors the flexibility to buy/sell bonds as they see fit.
Some examples of government securities are dated securities, treasury bills (T-Bills), and treasury bonds.
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