Money parked in fixed deposits (FDs) rose by Rs 6.1 lakh crore during the period April to July 3, twice the amount recorded during the same period in 2019-20. In the same period last year, banks had recorded fresh FDs worth Rs 3 lakh crore, The Times of India reported.
Moneycontrol could not independently verify the story.
The shift towards FDs could mean that depositors think interest rates will increase, and it may also hint at risk-aversion.
The report said HDFC Bank saw deposits growth of 24 percent year-on-year in the first quarter of FY21, and and current account-savings account (CASA) ratio fell to to 40.1 percent from 42.2 percent in March.
For Axis Bank, CASA ratio slid to 40.9 percent at the end of Q1 FY20 from 41.2 percent at the end of March.
In FY20, bank deposits made up 52.6 percent of household savings, followed by life insurance (23.2 percent), currency (13.4 percent) and mutual fund holdings (7 percent), the report said.
Banks' deposits growth fell 20 bps to 10.8 percent during the two weeks ended July 17, according to report by CARE Ratings. "The banks have been aggressively reducing their deposit rates to protect margins. The banking system daily average liquidity stood at Rs 6.5 lakh crore during the last two fortnights ended July 3 and July 17," the ratings agency said.