New Delhi: Deposits and advances in Indian banks almost tripled from FY15 to FY25, signalling deepening of the banking system and renewed credit intermediation, a report said on Monday. The report from SBI Research said that deposits rose from Rs 85.3 lakh crore to Rs 241.5 lakh crore and advances climbed from Rs 67.4 lakh crore to Rs 191.2 lakh crore during FY15–FY25.
The bank asset growth rebounded from 77 per cent of GDP to 94 per cent by FY25, reflecting renewed financial deepening, the report added. "Indian households across states are turning from savers to investors. Juxtaposing incremental deposits between FY20-25 and incremental investors during the same period reveals states such as Gujarat, West Bengal, Madhya Pradesh, Andhra Pradesh and Karnataka, etc. witnessing movement of deposits from banks towards financial markets at a faster pace," the report noted.
Further, over the longer FY5–FY25 period, deposits expanded from Rs 18.4 lakh crore to Rs 241.5 lakh crore while advances grew from Rs 11.5 lakh crore to Rs 191.2 lakh crore, signalling scale expansion of the banking system, the report said. However, the speed is much faster in the case of advances as credit-Deposit (C-D) ratio increased from 69 per cent in FY21 to 79 per cent in FY25, according to the research vertical. Public sector banks are gradually reclaiming market share in terms of advances after a secular decline since FY8, signalling balance‑sheet repair and renewed lending appetite, the report said.
For H1FY26, scheduled commercial banks’ incremental deposit growth eased to Rs 8.1 lakh crore from Rs 8.6 lakh crore in H1FY25 while credit rose to Rs 7.6 lakh crore from Rs 7.4 lakh crore. A recent report attributed the rise in PSB profits to fee income and treasury gains, alongside credit growth in the retail and MSME segments, and normalised operating expenses. It forecasts that profitability will improve in H2FY26, supported by festive-season demand, credit growth, the benefit from a lower CRR requirement, and a gradual normalisation of unsecured and MFI segment slippages.
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