According to Shalini Warrier, Retail Business Head at Federal Bank Ltd., deposit growth is the primary challenge for the Indian banking sector, as customers have more diverse investment options to choose from.
There is no easy solution to this issue,” Warrier stated on Bloomberg TV Monday. When fixed deposit rates do not increase to the level customers desire, they seek alternative investment options.
For several quarters, deposit growth has struggled to keep pace with the strong demand for credit in India, leading top officials to weigh in. Finance Minister Nirmala Sitharaman and RBI Governor Shaktikanta Das have both urged banks to innovate to boost their deposit growth, as household savings increasingly shift towards investment products.
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