Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) external member, Ashima Goyal, believes that banks tend to offer better interest rates for bulk corporate deposits that are not sticky. Goyal tells Piyush Shukla that lenders need to make interest rates more attractive for retail customers since they provide bulk of long-term liquidity. Excerpts:
Deposit growth may continue lagging credit growth in FY25. How can banks tackle this?
Banks have to make deposits more attractive for their customers. They tend to raise rates more for bulk corporate deposits that are quick to move to the best opportunity while neglecting retail deposits that provide the bulk of bank long-term…
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