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RBI data showed bank deposits reached Rs 200.8 lakh crore as of December 29, 2023, marking a rise of 13.2% from the corresponding period a year earlier. Of this amount, Rs 176 lakh crore was in term deposits and the rest was in savings and current account.
Banks are chasing deposits and offering high rates of interest which are being described as their “peak” by experts. Therefore, it’s no wonder that they have collected deposits more than the psychological Rs 200 lakh crore mark in 2023, The Times of India has reported.
This amount is more than double of the Rs 100 lakh crore that was achieved in cumulative deposits by the banks in September 2016. Therefore, bank deposits have recorded a compound annual growth rate of around 9.5% between September 2016 and December 2023.
RBI data showed bank deposits reached Rs 200.8 lakh crore as of December 29, 2023, marking a rise of 13.2% from the corresponding period a year earlier. Of this amount, Rs 176 lakh crore was in term deposits and the rest was in savings and current account.
Advances from banks rose over 20% compared to the December 2022 level and reached 159.6 crore.
This is the shortest time in which banks have added Rs 100 lakh crore to their deposit base. However, the rate of growth has slowed down, thanks to the higher base.
However, it must be mentioned that in the recent times, a substantial amount of domestic savings has moved to the mutual funds space. However, it is still far behind the bank deposits. In calendar year 2023, mutual funds have added Rs 10 lakh crore to its AUM, thereby taking it past the Rs 50 lakh crore mark. Still, it is just 25% of the figure achieved by bank deposits.
But the gap is closing. In 2003, bank deposits was at Rs 12.6 lakh crore. But mutual funds had a cumulative AUM of Rs 1.2 lakh crore.
Down the past two decades or so, bank deposits witnessed spectacular growth. It stood at Rs 5.1 lakh crore in the year 1997. But in just about four years, it climbed to Rs 10 lakh crore by June 2001.
In the next six years, the deposit base rose twice to Rs 20 lakh crore by March 2006.
In just three years and three months, the amount again doubled and reached Rs 40 lakh. This was also the fastest doubling of the deposit base of the banks in India.