Two-thirds of demat accounts are inactive, shows SEBI data

India’s stock market boom during the pandemic years saw millions of new investors rushing to open demat accounts. The excitement around IPOs and rising indices pushed the total number of accounts to nearly 22 crore. But fresh data from the Securities and Exchange Board of India (SEBI) shows a sobering reality: almost two-thirds of these accounts are now lying dormant.

As of January 2026, only one in three accounts remains active. This sharp fall in participation highlights how retail enthusiasm has cooled after the initial frenzy. Many investors stopped trading due to market volatility, weak returns, or simply lost interest. Some even forgot login details or abandoned accounts after the first few trades.

Experts say the rush was driven more by hype than by long-term planning. While IPOs and quick gains created excitement, sustained investing requires patience and discipline. The slowdown in domestic market performance compared to global peers has further discouraged small investors.

SEBI’s numbers underline a clear message: opening an account is only the first step. True wealth creation comes from staying active, informed, and disciplined. India’s retail investing boom now needs maturity, not just momentum.