Indian banks’ deposits and loans log double digit growth on sustained demand

Banks continued to see demand for auto loans and MSME loans.

India’s deposit and credit logged double-digit growth in the 2-week period ending 31 January 2026, indicating in funding mobilisation across local banks, said CareEdge Ratings.

Bank credit rose 14.5% YoY during the same period to $2.26t (INR204.8t or Rs 204.8 lakh crore), driven by steady retail demand.

Banks continued to see demand for auto loans, loans to micro, small and medium enterprises (MSME loans), corporate borrowings, and non-bank financial companies (NBFC), CareEdge wrote.

Indian banks’ deposit growth hit 12.4% year-on-year (YoY) over the same period.

Deposits stood at $2.74t (INR248.8t or Rs 248.8 lakh crore), lifted by time deposits growing 10.8% YoY during the period, the same rate of growth as the same period last year.

India’s banking sector had been noted for having high margins and low credit penetration, creating significant growth opportunities. However, bad loans and inefficiencies in state-owned lenders continue to weigh on the sector, analysts said.

Meanwhile, the country’s credit-to-GDP ratio stands at 53%, suggesting that access to formal credit is improving but remains limited.

(US$1 = INR 90.65; as of 18 February 2026)