Thursday, October 15, 2026

India’s Bank Deposits Hit Record $3 Trillion Amid Surge in Dollar Inflows

October 15, 2026 0 Abu Ramadan

India’s banking system deposits surged to a record 284 trillion rupees (approximately $2.99 trillion) in the second half of September 2026, driven largely by foreign-currency inflows and efforts by banks to strengthen their funding positions.

According to data released by the Reserve Bank of India (RBI) on Thursday, October 15, total bank deposits increased by 21.67 trillion rupees during the first six months of the country’s financial year.

The largest increase occurred between June and August, when the central bank introduced a discounted currency swap facility to attract dollar deposits from abroad.

Data showed that bank deposits increased by approximately 20 trillion rupees between June 16 and August 31.

In June, the RBI introduced the discounted swap window to encourage foreign-currency inflows and help commercial banks secure cheaper sources of funding.

The initiative attracted approximately $133 billion in inflows before the central bank closed the facility on August 31, one month earlier than originally planned.

Banks’ efforts to strengthen their financial positions ahead of the end of the quarter also contributed to the increase in deposits. During the two-week period ending September 30, deposits rose by 7.73 trillion rupees.

Overall, deposits across India’s banking system increased by 8.4 per cent between the end of March and the end of September.

Meanwhile, competition among banks for deposits remained relatively moderate, with the banking system maintaining a liquidity surplus, according to a report by CareEdge Ratings.

However, CareEdge warned that an October interest rate hike could prevent further reductions in fixed-term deposit rates and potentially push them higher.

The ratings agency explained that banks would need to attract additional funds to support credit growth, which is expanding faster than deposits, as excess liquidity in the financial system continues to decline.

The development highlights the growing importance of foreign-currency inflows and domestic deposit mobilisation in supporting India’s banking sector.