Business News Desk, In the coming days, banks will have to pay higher interest rate to customers on deposits. Actually, the speed with which banks are giving loans, deposits are not available in banks. In such a situation, banks will try to woo customers by offering more interest on FD-RD (Fixed Deposit- Recurring Deposit).
The Reserve Bank of India on Monday released quarterly data on the deposit-credit of banks. According to which, during the quarter from October to December 2022, the demand for loan has increased at the rate of 16.8 percent. Which is less than 17.2 percent in the July to September quarter. But it is much more than the deposits coming into the bank. Deposits in banks grew at a rate of 10.3 per cent between the October to December quarter. According to RBI, the increase in deposit growth rate has been due to an increase of 13.2 per cent in term deposits. While the current and savings growth rate has increased at the rate of only 4.6 percent.
These figures are telling that the amount of deposits is not coming in the banks as much as there is demand for loans. If this continues, then there may be a shortage of cash with the banks to give loans. In such a situation, banks may have to increase the interest rates on deposits. Higher interest may have to be paid on fixed deposits and recurring deposits so that people can be attracted to keep deposits in banks. RBI has increased the repo rate six times in a row in the last 9 months by 2.50 per cent to 6.50 per cent. After this the banks made loans costlier but did not increase the interest rates on deposits in that proportion. But given the rising demand for loans, banks may have to make deposits attractive to raise cash.