Deposit Growth Lags at 10.9% as Banking Sector Credit-Deposit Ratio Stays Elevated at 82.5%

India's credit-deposit (CD) ratio has maintained a record level of 82.5% for the fourth consecutive fortnight, ending on February 15, 2026.  

This trend highlights the ongoing scenario where credit growth is outpacing deposit growth within the banking sector. 

Credit Growth Surpasses Deposits 

As of February 15, 2026, total bank credit in India reached ₹204.3 trillion, marking a 13.7% year-on-year increase. This growth rate is an improvement over the 11.3% recorded in the same period last year.  

The rise in credit offtake is driven by steady momentum in retail and small business lending, increased exposure to non-banking financial companies, and some improvement in infrastructure financing. 

Deposit Growth Lags Behind 

In contrast, bank deposits grew by 10.9% year-on-year to ₹247.7 trillion, slightly higher than the 10.3% growth observed in the previous period.  

Despite this increase, the gap between credit and deposit growth has widened to 281 basis points, maintaining the CD ratio at a record high. 

Factors Influencing the CD Ratio 

The sustained high CD ratio reflects the robust demand for credit across various sectors of the economy. Retail lending has been a significant contributor, with consumers increasingly seeking loans for personal and business needs.  

Additionally, the banking sector's enhanced focus on infrastructure financing has played a role in boosting credit growth. 

Read More: Just 3.21 Crore Indian Households Invest in Markets; Only 9.5% Participation! 

Implications for the Banking Sector 

The current CD ratio indicates a strong credit demand, which is a positive sign for economic activity. However, it also underscores the need for banks to attract more deposits to balance their books and ensure sustainable growth.  

The banking sector may need to explore innovative strategies to enhance deposit mobilisation. 

Conclusion 

India's CD ratio remaining at 82.5% highlights the ongoing trend of credit growth outpacing deposit growth. With credit demand being robust, the banking sector faces the challenge of balancing credit and deposit growth to maintain financial stability. 

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