MUMBAI: India's banking system deposits are gaining pace and have witnessed a jump over the last three fortnights to a record high, central bank data show, mainly supported by dollar inflows into banks from the Reserve Bank of India's foreign-currency non-resident scheme, traders said.
Here are a few details:
Banking system deposits jumped by an aggregate of 11 trillion rupees ($115.25 billion) in three fortnights to July 31, RBI data shows
Also Read: RBI's FCNR(B) scheme attracts $41 billion, Jefferies says inflows may double to $80-100 billion
Deposits had witnessed a net reduction of 3.87 trillion rupees from April 1 to June 15
In June, RBI announced discounted swap windows to attract NRI deposits and encouraged lenders and state-run companies to raise cheaper dollar funding
The schemes witnessed inflows worth almost $41 billion by the end of July, as per RBI data
READ ALSO: Banks continue to garner FCNR deposits at a brisk pace
"The conversion of dollars into rupees has gained pace, which is the major reason for the recent boost in deposits," trader with a state-run bank says
Overall deposits in the banking system stand at a record 269.4 trillion rupees, up by 7.1 trillion rupees in first four months of the fiscal year starting April
Looking ahead, it is likely that credit conditions would stay strong as skewness in credit-deposit ratio for banks corrects via pickup in deposit growth led by FCNR flows, ICICI Securities Primary Dealership says.
