In charts: Just five commercial banks hold 50% of all deposits in India

Did you know that when it comes to the largest Indian banks by deposits, a select few dominate the financial landscape

When it comes to the largest Indian banks by deposits, a select few dominate the financial landscape.  Just five commercial banks hold 50 per cent of all deposits in India, and the top 10 (of which 7 are government banks) account for 75%.

 Indians love government banks

"For every Rs 100 deposited in an Indian commercial bank, the share of government banks is a whopping Rs 62. Around Rs 32 are deposited with private banks. Just under Rs 5 can be found with foreign banks, and the rest—just under Rs 1—is with small finance banks and payment banks," shows data analysed by Bankbazaar.

Even though small finance banks offer higher interest rates when compared to bigger commercial banks, only 0.8 per cent of India's savings are in such banks.

While concerned about the safety of your fixed deposit when you opt for a relatively unknown small finance bank may be the reason for this, do keep in mind that small finance banks are also regulated by the Reserve Bank of India (RBI) since they have been categorised as scheduled banks just like PSUs and other private sector banks by the central bank.

Deposits opened with small finance banks are protected by the deposit insurance programme to the tune of Rs 5 lakh. However, it includes both the principal and interest amounts. So, if you want to book a cumulative fixed deposit in a small finance bank, you should invest in a way that the total amount remains within the threshold of Rs 5 lakh at the time of maturity of your deposit.
 

SBI most most-loved bank

At the forefront stands the largest public sector bank State Bank of India with a staggering 23 per cent of total deposits of commercial banks in India

Second is HDFC Bank, a private banking giant, accounting for 9% of these deposits.

Banks with the most deposits: 

"Indians love government banks for a variety of reasons. First, there’s the presence itself. Nationalised banks have a wider network of branches. India has over 19,000 pin codes. As per RBI’s last count, the 12 nationalised banks had around 65,000 offices including branches. That’s more than the touch points per pin code. In comparison, the 21 private banks had around 42,000 offices. The wider presence of nationalised banks, especially beyond the large urban centres, makes them more visible in comparison, and it’s what the populations around them prefer when they want to open a savings account, take a loan, or start an investment account," said Adhil Shetty, CEO of Bankbazaar.

 Nationalised banks have also been around longer as compared to private banks that started getting approvals only in the mid-90s. They are catching up fast through digitisation and high-quality customer service.