Banks deposits grew slower than credit for the fortnight ended March 21, according to the Reserve Bank of India (RBI) data released on Friday.
Outstanding deposits grew 10.3% while outstanding credit expanded 11%, showed the RBI’s weekly statistical supplement.
Outstanding deposits of banks increased to Rs 225.7 lakh crore as of March 21, from Rs 204.7 lakh crore in the year-ago period. Bank credit reached Rs 182.4 lakh crore from Rs 164,3 lakh crore.
Banks in FY25 intensified efforts to strengthen liability franchises and have offered higher rates on term deposits. Lenders were also sourcing funds via certificates of deposits at relatively-higher costs.
According to the RBI, issuances of certificates of deposit grew 34% YoY to reach an all-time high of Rs 10.58 lakh crore during 2024-25 (up to March 7, 2025). Commercial paper issuances at Rs 13.90 lakh crore were 13.5% higher YoY during FY25 (up to February 28, 2025).
The credit-to-deposit (CD) ratio remained elevated at above 80%. This elevated CD ratio can be attributed to tightened liquidity conditions and deposit growth lagging credit offtake,noted a report by CareEdge Ratings.