India banks face funding squeeze as credit outpaces deposits
India's banks are experiencing a funding squeeze as credit growth outpaces deposits, with the credit-deposit ratio reaching 97% by January 2026. SBI has raised its credit growth guidance to 13-15% amid this liquidity pressure.
pre-market1 source ↓written by the desknot a recommendation
- by January 2026
- 97%
- 82.3%
- Aggregate deposits grew
- 10.2%
- while credit expanded
- 12.2%
- for the year
- 13-15%
The surge in bank credit growth is pressuring system liquidity, with the credit-deposit ratio nearing 97% by January 2026, up from 82.3%. Aggregate deposits grew 10.2%, while credit expanded 12.2%, leading banks like SBI to raise their credit growth guidance to 13-15% for the year. This trend may impact profitability as banks manage funding costs.
Not investment advice. For informational purposes only.