Bank credit and deposits growth decelerate in Q3FY25: RBI
Reserve Bank of India (RBI) in its latest data has showed that bank credit as well as deposits witnessed deceleration during the October-December quarter (Q3FY25) sequentially. Bank credit growth (y-o-y) decelerated to 11.8 per cent in December 2024 from 12.6 per cent in September 2024, while aggregate deposits increased at a marginally lower pace at 11 per cent as compared to 11.7 per cent growth in July-September period. Personal loans, which have large share (31.5 per cent) in total credit, recorded moderation in annual growth to 13.7 per cent (15.2 per cent a quarter ago). Credit to agriculture and industry sectors also recorded some tempering in the growth. On the other hand, bank lending for trade, finance and professional/ other services accelerated during the third quarter of 2024-25.
The data showed that lending to public sector organisations accelerated to 5.4 per cent in December 2024 as compared to 0.3 per cent in the preceding quarter. Its share in total credit stood at 13.6 per cent. Bank charged 8 per cent to less than 10 per cent interest rate on over half of the loan amount and nearly 16 per cent of the loans were bearing less than 8 per cent interest rate; the remaining loans were bearing 10 per cent or above interest rate. The data regarding 'Deposits with Scheduled Commercial Banks - December 2024' revealed that term deposits rose by 14.3 per cent (y-o-y) as compared to 5.1 per cent growth in saving deposits in December 2024. As a result, the share of term deposits in total deposits rose to 62.1 per cent from 60.3 per cent a year ago.
RBI further said the share of deposits bearing 7 per cent or above interest rate in total term deposits increased to 70.8 per cent in December 2024 from 61.4 per cent a year ago. With rise in return on term deposits, nearly 79.8 per cent of the incremental term deposits mobilised during April-December 2024 were held in the original maturity bucket of one to three years; on an outstanding basis, over two third of term deposits were in this maturity bucket and another 11 per cent had higher original maturity. During April-December 2024, 56.1 per cent of the total term deposits were of size Rs 1 crore and above.
