Trends and patterns of the commercial bank deposits in India in the Post-Liberalisation period
Commercial banks play a crucial role in the financial intermediation and capital formation process for the development of modern economies and societies. Deposit mobilization is the first and foremost step in the financial intermediation process of the commercial banks. This article examines the trends and patterns of commercial bank deposits in India in the post-liberalization period. The analysis in this study is based on the Reserve Bank of India (RBI) data on commercial bank deposits in India for the post- liberalisation period from 1992-93 to 2016-17. There was a steady growth of the aggregate commercial bank deposits in India during the post liberalization period and the growth gained further momentum after 2004-05. Term deposit grew significantly faster than the demand deposits in India during the period. The trend in the aggregate bank deposits in the post liberalization period was largely determined by the trend in the time deposits. More than 85 percent of the total commercial bank deposits in India during the period were in the form of time deposits; and the share of time deposits in the total commercial bank deposits has slowly increased over time. Savings bank deposit, the most popular form of individual deposits in India, grew faster than all other deposits during the post liberalization period. The share of savings deposits mobilized by the foreign banks in India has been relatively negligible compared to that of Indian banks. The ever growing commercial bank deposits in India, if properly channelised, will definitely lead to the economic growth and development of the country.