RBI Data: Credit Growth at 18.2%, Deposits at 16.7%; a 1.5-Point Gap Keeps Funding Pressure on Banks
Loan demand in the country remains strong, but deposits in banks are growing at a somewhat slower pace. According to RBI data up to October 15, 2026, bank credit grew 18.2% year-on-year while deposits grew 16.7%. Meanwhile, the RBI has raised the repo rate to 5.50%. Together, these three developments could affect banks' funding as well as FD and loan rates for customers.
What do the numbers say?
In the fortnight ended October 15, 2026, credit growth eased to 18.2% from 19.4% in the previous fortnight. Deposit growth slipped to 16.7% from 17.8%. Total deposits stood at ₹278.76 lakh crore and total credit at ₹227.43 lakh crore.
On a year-on-year basis, deposits rose by ₹39.93 lakh crore and credit by ₹35.07 lakh crore. The dip in growth rates also reflects movements within the fortnight itself. During this period, deposits fell by ₹5.19 lakh crore and credit by ₹2.52 lakh crore.
| Parameter | As of Oct 15, 2026 | Annual growth |
|---|---|---|
| Bank credit | ₹227.43 lakh crore | 18.2% |
| Deposits | ₹278.76 lakh crore | 16.7% |
The credit-deposit gap: how big is it?
The gap between credit and deposit growth is 1.5 percentage points. The credit-deposit ratio held steady at 81.59%, which means that for every ₹100 of deposits, banks have lent out roughly ₹82.
One piece of context is important here. Deposits are not weak. In August 2026, deposit growth was 17.8%, the highest in 15 years. Foreign currency (FCNR-B) deposits raised under a special RBI scheme played a big part in this. The concessional swap facility, which began in June, made it easier for banks to mobilise foreign currency deposits. In other words, the challenge is not that deposits are falling, but that loans are growing even faster.
Food credit nearly doubles
Food credit is the bank lending given to the FCI and state government agencies to buy grain at the MSP.
- October 17, 2025: ₹52,489.66 crore
- October 15, 2026: ₹100,093 crore
- Increase: about ₹47,603 crore, or roughly 91% (our calculation)
This amount is a very small share of total credit. The real driver of loan expansion is the ₹226.43 lakh crore of non-food credit.
Repo rate raised, what next?
On October 7, 2026, the MPC raised the repo rate by 25 basis points to 5.50% and changed its stance to "calibrated tightening". This is the first increase since February 2023. The SDF rate is now 5.25%, and the MSF rate and Bank Rate are 5.75%.
Rating agency CareEdge expects credit growth to moderate to around 15-16% in FY27, owing to higher borrowing costs and tighter liquidity. According to CareEdge, competition for deposits has remained limited while liquidity was in surplus. In September, the lower end of certificate of deposit rates rose to 5.77% from 5.57%.
What does it mean for ordinary people?
- FD rates: If credit keeps growing faster than deposits, banks may raise rates to attract deposits. This is an expectation, not an announcement by any bank.
- Loan rates: The EMIs on repo-linked floating-rate loans may rise at the next reset, depending on the loan terms.
- The pace ahead: Ups and downs in fortnightly data are normal. The real picture will become clearer from the next few data releases.
What to watch next
- The credit-deposit gap in the next RBI fortnightly data
- Changes in banks' FD and CD rates
- The impact of the repo rate hike on loan growth
- The pace of FCNR(B) deposit inflows
Disclaimer: This article is for information purposes only. Please do not treat it as investment advice.
