Bank deposits slow: lenders are staring at a new challenge to reduce credit growth by a glimmer of hope as borrowers await the June 6 tax rate decision!

RBI interest rate decision, MPC reviewed on June 6, bank deposit growth: In the fiscal year ended March 31, 2025, the country’s commercial banks’ deposit growth rate fell to 10.6%, compared with the corresponding period a year ago, data from the Reserve Bank of India (RBI) marks a drop of 240 basis points (BPS). Many analysts say the possibility of a central bank’s Monetary Policy Committee (MPC) cutting more interest rates could worsen lenders’ deposits and credit conditions as customers leave financial products such as savings accounts and time deposits.

The country’s development was conducted on June 6 as the result of a bimonthly monetary policy review, which should be held on June 6, and the panel of tax rate sales led by the governor of the Reserve Bank of India is widely expected to announce a reduction in the benchmark loan ratio (Repo rate). The repurchase rate is the key interest rate for the Reserve Bank of India to lend short-term funds to commercial banks.

Some parts of Dalal Street are also expected to reduce by 50 basis points (BP) in the upcoming MPC review.

Analysts say silent credit growth is temporarily exempting banks from cash tightening, but that credit growth may change once it recovers.

In May, according to a report by the State Bank of India (SBI) (SBI), the country’s largest lender said credit growth for the country’s booked commercial banks is estimated to be compared with 19.5% a year ago, and loan activity in the industry is estimated to slow down compared with 19.5% a year ago, which is a sharp contrast to 9.8%.

Although the RBI has taken steps to keep the system unchanged at a rate of cash, the expected loan demand could lead to stricter liquidity conditions.

Some analysts say the data points to the transfer of retail investors from fixed returns tools such as fixed deposits to riskier assets such as stocks and related products such as mutual funds, regardless of the associated risks and severe market conditions.

Currently, the benchmarks for Dalar Street appear to be delineated as concerns over the ongoing pause inflows of foreign funds are growing. So far, June

Meanwhile, the blue chip index Nifty50 is above 1,700 points from its all-time high in late September. Its ranges over 3,350 points, ranging from 25,116.3 to 21,743.7 and is in the intraday trading date to date.

FD and small savings plan rate

Most commercial lenders have interest rates below the 7.0% PR, while small savings plans such as 3- and 5-year post office time deposits, Senior Citizen Savings Plan (SCSS), Monthly Income Plan (MIS), and Sukanya Samriddhi Account continue to offer higher rates.

Post Office plans to pay more than 7.0% of returns