Indian banks deposits and credit grow at the same pace

Deposits have expanded by $147.73b between January-August 2024.

Indian banks’ credit growth is trending down and is now growing at the same pace as deposits.

Credit offtake increased 6.2% as of August 2024, compared to December 2023, according to CareEdge Ratings, using data from the Reserve Bank of India (RBI).

Deposits have also risen by 6.2% to reach about $2.54t (INR 213.2 lakhs crore) in August, driven by the growth of time deposits.

Deposits have expanded by approximately $147.73b (INR12.4 lakhs crore) over the eight-month period.

“Deposits will continue to be prominent in FY2025 as banks intensify efforts to strengthen their liability franchise. The banks are also sourcing funds via the certificates of deposits– at a relatively higher cost– which have shown significant traction,” CareEdge Ratings wrote in a report published on 10 September.

Personal loans and loans extended to micro, small, and medium enterprises (MSME) accounted for most of the increase, CareEdge Ratings said.

(US$1 = INR83.94. 1 lakh krore = 1 trillion rupees. Conversion rate as of 11 September 2024, 3:12PM)