In News:

The World Wealth Report 2025, released by the Capgemini Research Institute, highlights a significant surge in global and Indian high-net-worth individual (HNWI) wealth. The report covers 71 countries, representing over 98% of global Gross National Income (GNI) and 99% of world stock market capitalization.

India’s HNWI Landscape in 2024

• HNWI Wealth Growth: India witnessed an 8.8% increase in HNWI wealth in 2024.
• Total Millionaires: The country had 378,810 HNWIs by the end of 2024, with a cumulative wealth of $1.5 trillion.
• Millionaires Next Door: Among them, 333,340 individuals fell under the "Millionaires Next Door" category (investable assets between $1M–$5M), holding $628.93 billion in wealth.
• Ultra HNWIs: India was home to 4,290 Ultra-HNWIs (assets ≥ $30M), with combined assets worth $534.77 billion.

Global Trends in HNWI Wealth

• Global Growth: HNWI population worldwide rose by 2.6%, driven largely by a 6.2% rise in Ultra-HNWI numbers.
• Investment Trends: Alternative investments (private equity, cryptocurrencies) formed 15% of HNWI portfolios, signaling diversification beyond traditional assets.
• Top Contributors:
  • United States added 562,000 millionaires, recording a 7.6% rise, reaching a total of 7.9 million HNWIs.
  • The U.S. also holds 36% of centi-millionaires (net worth ≥ $100M) and 33% of the world's billionaires.
  • India and Japan saw 5.6% growth, while China recorded a 1.0% decline in HNWI population.

Shifting Dynamics in Wealth Management

• A massive “great wealth transfer” is underway globally.
  • 81% of global next-gen HNWIs and 85% of Indian next-gen HNWIs plan to switch wealth management (WM) firms within 1–2 years of inheritance.
  • Key reasons include:
    • Lack of preferred channel services (51%)
    • Ineffective digital transaction tools (41%)
• Digital Transformation Need: The evolving expectations of next-gen clients are pushing firms toward AI-enabled advisory models and advanced digital infrastructure.

Offshore Wealth Allocation

• By 2030, 98% of Indian next-gen HNWIs plan to increase their offshore assets by over 10%.
  • Motivations include:
    • Superior investment options (55%)
    • Better wealth management services (65%)
    • Improved market connectivity (54%)
    • Tax efficiency and political-economic stability (49%)