Bank deposits hit decade-high growth as NRI dollar inflows cross $37 billion

Bank deposits surged by 15.4% year-on-year at the end of July, the fastest growth in nearly a decade, as overseas Indians deposited around $37 billion in foreign currency-linked non-resident accounts within two months of the Reserve Bank of India establishing a special window for dollar inflows. Credit growth also surged to 19.4% during the same period, marking the quickest pace since June 2024.

Outstanding deposits reached Rs 269.4 lakh crore by the end of July, up from Rs 233.5 lakh crore as of July 2025. Bank credit stood at Rs 220.8 lakh crore, compared to Rs 185 lakh crore earlier. This growth was mainly fueled by increased corporate demand, with companies opting to borrow from banks due to higher bond yields. Banks also expanded lending to micro, small, and medium enterprises (MSMEs) through a government-supported financial assistance program designed to provide additional funding, partially or fully guaranteed, in response to the West Asia crisis.

In July 2016, scheduled commercial banks recorded an even faster growth rate of 15.9% in deposits, but since then, growth had remained below 15.4%. The Foreign Currency Non-Resident (FCNR-B) scheme, introduced in June, attracted $41 billion in inflows, with the majority of deposits coming from this scheme. The country had mobilized a total of $41 billion via the FCNR-B scheme by July 31, surpassing the $26 billion amassed under a similar scheme in 2013. The current scheme is set to conclude on September 30, 2026.