Explanation:

The SEC Classification is the classification of consumers on the basis of parameters. Traditionally the two parameters used to categorize consumers were: Occupation and Education of the chief wage earner (Head) of the households. The SEC classification, created in 1988, was ratified by Market Research Society of India (MRSI), is used by most media researchers and brand managers to understand the Indian consuming class. Originally developed by IMRB International as a way of understanding market segments, and consumer behavior it was standardized and adopted by the Market Research Society of India in the mid-1980s as a measure of socio-economic class and is now commonly used as a market segmentation tool in India.
This is based on the assumption that higher education leads to higher income thus higher consuming potential. But, we know that this may not always be true. A trader or a retailer with no qualification can earn more income than a Post graduate executive, but SEC will categorize the traders/retailers not as SEC A1or A2.

So, in order to combat this problem, the Government came up with the new SEC system on 3 May 2011.