Credit-deposit growth gap widens to a three-year high of nearly 5%

Development fuels concern that slow deposit growth could emerge as one of the biggest constraints for loan growth in the system

While credit growth in the system has picked up, deposit growth has not kept pace with credit growth, resulting in a widening of the gap to an over three-year high, thus exacerbating concerns that slow deposit growth could emerge as one of the biggest constraints for loan growth in the system.

According to the latest Reserve Bank of India (RBI) data, credit growth in the system for the fortnight ended June 17 was 13.2 per cent and deposit growth was 8.3 per cent--a gap of 490 basis points.

“…our biggest concern is that the gap between deposit growth and loan