MUMBAI: Banks in India have crossed the milestone of ₹150 trillion in deposits, as inflows proceed at a staggering tempo.
Deposits had touched the ₹100-trillion mark in September 2016 and had crossed ₹50 trillion in February 2011.
Excellent financial institution deposits stood at ₹151.13 trillion as on 26 March, the final fortnight of the monetary yr, confirmed knowledge launched by the Reserve Financial institution of India (RBI). This interprets right into a progress of 11.3% from the identical interval final yr. In distinction, non-food credit score grew at a sluggish tempo of 5.5% year-on-year (y-o-y) to ₹108.9 trillion.
To make sure, the unebbing progress in deposits and sagging credit score progress have continued at the least for the previous one yr. Trade specialists mentioned that the influx in deposits might be as a result of traders are danger averse and need a sure steady return from their financial savings. This was even supposing besides in a few state-owned banks, deposit charges haven’t been hiked within the latest previous. Actually, Mint reported on 2 April that after two months of constructive however near-zero returns in December and January, the inflation-adjusted return stood at -0.03% in February for such deposits—thought-about one of the common modes of financial savings for many Indians.
“The rise in general deposits might be owing to steady outflows witnessed in fairness mutual fund coupled with decrease inflows in debt mutual fund throughout the quarter below overview, indicative of danger aversion by traders which may help the rise in financial institution deposits,” Care Rankings mentioned in a be aware on 8 April, stating credit score and deposit progress tendencies in Q3.
In the meantime, some non-public banks have reported their enterprise numbers lately, showcasing robust deposit progress. India’s largest non-public sector lender HDFC Financial institution mentioned its deposit base rose to about ₹13.35 trillion as on 31 March, registering a progress of round 16.3% y-o-y. Federal Financial institution reported provisional complete deposits of ₹1.72 trillion as on 31 March, up 13% over the identical interval final yr. IndusInd Financial institution additionally reported a robust deposit progress of 27% y-o-y to ₹2.56 trillion on the finish of the March quarter of FY21.