India bank credit growth reaches 19% as deposits rise

According to a Jefferies India Financial Daily report, bank credit growth in India accelerated to 19 per cent year-on-year as of August 31, 2026. This surge follows a period of slower growth throughout much of 2024 and early 2025.

Deposit growth also increased, reaching 18 per cent by the end of August. This rise in deposit mobilisation has helped narrow the gap between loan growth and deposit growth, easing pressure caused by rapid credit expansion. The credit-to-deposit ratio was reported at approximately 80 per cent, while the investment-to-deposit ratio stood at around 26 per cent.

Liquidity conditions in the banking system showed improvement, with surplus liquidity estimated at approximately Rs 5 trillion as of September 21. While private banks have maintained their market share during this credit surge, analysts suggest the pace of growth may moderate in the future.