Delhi Delhi:Banks struggled to raise large deposits to meet rising credit demand in the last two financial years, a report said. The outstanding credit disbursed by scheduled commercial banks (SCBs) was at an all-time high in 2023-24, which was Rs 1,64,98,006 crore, while in percentage terms, the growth of credit-to-deposit (C-D) ratio increased from 75.8 per cent to 80.3 per cent, Infomerics Ratings said in a report.RBI April 2024 Bulletin According to , the incremental credit-deposit ratio (ICDR) during March 2024 stood at around 95.94 per cent, as against 92.95 per cent as on March 8, 2024. It can be seen that quarter-on-quarter (QoQ) Even on a national basis, the growth in loans of SCBs has been much higher than the growth in deposits.
During the period FY 2019 to FY 2024, credit growth has been higher than deposit growth. Alternative Investments Alternative Investments And substantial cash holdings in the unorganized sector slowed down deposit accumulation, especially in rural areas. It is interesting to note that the proportion of individual investors under the age of 30 years has been steadily increasing, their share in the registered investor base has increased. from 22.6 per cent in FY 2019 to 39.9 per cent in FY 2025 (till July 31, 2024). This trend reflects the growing interest in equity markets among young investors, 30-39 during the same period, it said. The share of investors aged 15 to 25 remained relatively stable, while the share of those over 40 declined.
True North Financial Services CEO Rochak Bakshi said that banks and the government should make joint efforts to increase the deposit ratio. He said banks should return to the old trend of raising small deposits from the retail public, which has historically been the country's strength, and not raise corporate deposits on a large scale. Furthermore, Bakshi said that a notable trend is that 47 per cent of fixed deposits are held by senior citizens, which means the younger generation is not attracted towards bank deposits. “The government should consider reducing taxes on interest, especially on the highest tax slabs. Also, it may consider taxation at the time of maturity of fixed deposits instead of the current system of taxation on annual accruals,” he said.
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