Banks’ loan growth outpaces deposits

Deposit growth in the system has been trailing credit growth for quite some time now.

According to the Reserve Bank of India (RBI) data, credit growth touched a decadal high of 18 per cent in the fortnight ended October 7 but deposits grew at a much slower pace of 9.6 per cent.

The widening credit-deposit growth gap has exacerbated concern that the slower pace of liabilities growth may prove to be the biggest constraint for loan growth in the system.