RBL bank plans to grow its granular deposits from 35% to 55% in FY26. Narendra Agrawal, president & head of branch banking and retail liabilities at RBL Bank tells Mahesh Nayak that through CRM-led engagement and bundled offerings, such as credit cards, SIPs, and insurance, the bank is steadily increasing its wallet share and aiming for faster customer monetisation. Excerpts:
What are the core strengths RBL is leveraging to grow retail banking?
With a substantial credit card customer base of 5 million and a low savings account penetration rate of less than 3%, this scenario is ripe for cross-selling, enabling the bank to leverage its existing customer relationships and increase product holdings. Additionally, the bank’s strong wholesale banking franchise can be tapped to acquire personal and salary accounts, further expanding its customer base. A significant 80% of our customers currently hold only one product, highlighting the vast potential for cross-selling and expanding wallet share. With a 560-branch network, the bank is well-positioned to capitalise on these opportunities and drive growth through increased customer engagement and product adoption.
What are the top strategic agendas for branch banking?
When I joined RBL, one of the first things I noticed was the disproportionate reliance on wholesale liabilities. Our retail deposit accounted for just 35% of our mix. The ratio has improved from 35% to 52%, with a target of 55% for this fiscal year, driven by growth in CASA and fixed deposits below Rs 3 crore. The cost of deposits has decreased, with savings account costs dropping to 5.24% (from 6.4% as of March 2025) and fixed deposit costs to 7.52% (from 7.69%). This results in a total deposit cost reduction to 6.23% (from 6.53%). Retail asset disbursals through branches are expected to triple to Rs 6,000 crore. The bank is also focused on increasing wallet share and product holding, with one-product customers decreasing to 77% from 80%. Branch profitability has increased to 50% from 37% of the 560 branches, with a target of 60% by FY26. To support growth, 210 new branches will be opened over 2.5 years, aiming for 770 branches by FY28, with 70 branches planned for this year. These initiatives position the bank for sustained growth and improved profitability.
How are you viewing the bank’s asset-led liability growth?
We see the bank’s retail asset disbursements through branches grow three times, from Rs 2,000 crore to Rs 6,000 crore, for FY26. Already, by July this year, we have achieved a growth of Rs 2,000 crore. We expect gold loans to scale up from Rs 300 crore to Rs 1,800 crore, while home and business loans to grow from Rs 1,700 crore to Rs 5,000 crore.
How is RBL approaching affluent banking and wealth management?
The bank’s deposit base is significantly driven by affluent customers, with 60% of deposits coming from this segment, largely inherited from its legacy banks, such as ABN Amro and RBS. To cater to these high-value customers, the bank has revamped its “Insignia” and “Signature” propositions, offering tailored solutions across wealth, business, and NRI segments. To enhance customer retention and deepen engagement, the bank plans to launch a dedicated wealth management platform in the coming quarters, focusing on retaining CASA (Current Account and Savings Account) balances and offering a more comprehensive suite of financial services.
How is RBL balancing physical and digital acquisition?
RBL Bank is adopting a hybrid acquisition model, combining digital scale with a depth of physical engagement. Digitally, 95% of corporate salary accounts are sourced online, and DIY journeys are being rolled out for current accounts. Mobile banking platforms, like ‘MyBank’ and ‘BizBank’, enhance the customer experience. Digital acquisition costs have dropped to Rs 500- Rs 1,000 per account. The bank is expanding its branch network, securing approval for 210 new branches over a period of 2.5 years. Physical engagement significantly boosts customer value, with average ticket sizes (ATS) rising to Rs 90,000-1,00,000 compared to Rs 7,000-10,000 for digital-only new acquisitions. Bundled onboarding and cross-selling are compressing break-even times for savings accounts from 7-8 years to under 3 years. The bank’s strategy focuses on digital acquisition, physical engagement, and intelligent monetisation to build a scalable, profitable, and sticky retail franchise.
What’s the strategy for Gen Z and younger salaried customers?
The bank is introducing innovative bundled products, such as ‘Next Plus’ and ‘Elevate’, designed to cater to customers’ lifestyle needs. Additionally, we aim to significantly scale up our monthly account acquisitions from 6,500 to 15,000 accounts per month in a phased manner for the current fiscal year. A key focus area is early cross-selling, where the bank plans to embed offerings like credit cards, Systematic Investment Plans (SIPs), and sachet insurance within the customer onboarding process, thereby enhancing product adoption and deepening customer relationships from the outset. From an average customer age group of 45 and above, our focus has shifted to catering to a 25 to 45-year-old age group, while continuing to prioritise senior citizens.
Is the surge in gold loans a concern for RBL?
Despite the industry-wide growth in gold loans exceeding 100%, RBL has observed stable repayment behaviour from its customers, indicating a healthy loan portfolio. The use of gold loans is primarily for household needs rather than speculative activities, suggesting a more sustainable and responsible borrowing pattern. Looking ahead, the bank expects the growth in gold loans to taper in the coming quarters, potentially due to seasonal factors or market saturation.
What’s the bank’s stance on MSME lending?
The bank’s MSME (Micro, Small, and Medium Enterprises) loan book has doubled, underscoring its strategic focus on this segment. To further bolster growth while managing risk, the bank has established tie-ups with credit guarantee schemes. These partnerships aim to mitigate potential credit risks and expand the bank’s reach to a broader array of MSME customers. The bank has not observed any immediate stress in its MSME portfolio, indicating a healthy and well-managed exposure to this critical sector.