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Indian Bank Lending Surges to 19% Amidst Strong Deposit Growth
22 Sep
Summary
- Bank credit growth accelerated to 19% by August 2026.
- Deposit growth also picked up to 18% by the same date.
- Banking system surplus liquidity was around ₹5 lakh crore as of September 21, 2026.
Bank credit growth in India has surged, reaching a 19% year-on-year increase as of August 31, 2026. This acceleration indicates a sustained momentum in bank lending activities across the nation. Concurrently, deposit growth has also strengthened, climbing to 18% by the same date.
The credit-to-deposit ratio remained around 80%, with investment growth at 16%. The report highlights that the gap between loan and deposit growth has narrowed, alleviating pressure caused by rapid credit expansion. This trend has been recovering since mid-2025.
Furthermore, liquidity conditions within the banking system have improved. As of September 21, 2026, the surplus liquidity was approximately ₹5 lakh crore. While lending remains supported by improving momentum, a slight moderation in credit growth is anticipated in the coming months.
