The share of banks’ term deposits with an interest rate of ‘less than 7%’ rose from 29.2% a year ago to 56.3% in December 2025

A cashier counts Indian banknotes as customers queue at a bank in Chandigarh, India, November 10, 2016. Comparative analysis INDIA-MODI/CORRUPTION-BANKS REUTERS/Ajay Verma/File Photo | Photo credit: AJAY VERMA

As a result, the share of time deposits with interest rates of ‘7 percent and above’ fell to 43.7 percent in December 2025, compared to 70.8 percent a year ago.

The above development follows the RBI’s rate-setting monetary policy committee cutting the policy repo rate cumulatively by 125 basis points to 5.25 percent during February-December 2025.

Term deposits increase by 11.5%

Term deposits, the main driver of deposit accumulation, recorded a growth of 11.5 percent (year-on-year) in December 2025, surpassing the growth of current deposits (11.1 percent) and savings deposits (8.3 percent), according to RBI’s Quarterly Basic Statistical Return (BSR) on deposits with SCBs.

Deposit growth (yoy) in public sector banks improved to 9.9 percent in December 2025 from 9.1 percent last year, while the same growth in private sector banks decelerated by 2.1 percentage points over the period to stand at 11.3 percent in December 2025.

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The household sector continued to be the largest contributor with 60.1 percent of deposits at end-December 2025. During the first three quarters (9 months) of the 2025-2026 financial year, the household sector accounted for more than three-quarters of the total change in SCBs’ deposits.

As of December 2025, almost 70.5 percent of time deposits had an original term of one to three years, while 19.5 percent of time deposits were short-term deposits with an original term of up to one year.

According to the BSR statement, the contribution of women depositors to the SCB’s total deposits increased to 20.8 percent by December 2025, compared to 20.6 percent a year ago.

Furthermore, the share of deposits held by seniors has increased from 20.2 percent a year ago to 20.7 percent in December 2025.

The household sector continued to be the largest contributor with 60.1 per cent of deposits at end-December 2025. During the first three quarters (9 months) of FY 2025-26, the household sector accounted for more than three-quarters of the total change in deposits of SCBs, RBI said.

The share of term deposits of ₹1 crore and above increased and stood at 45.8 per cent by December 2025 (45.5 per cent a year ago).

Published on February 27, 2026