India’s credit-deposit ratio as of December 15 last year, Pg8

Key Highlights:

• India's Credit-Deposit (CD) ratio reached 82% as of December 15, 2025.
• The CD ratio has been increasing since 2000-01, when it was at 53%.
• The increase in CD ratio signifies better financial development and strong economic growth.

Detailed Insights:

• The rise in CD ratio reflects the increasing financialization of the Indian economy.
• A higher CD ratio indicates that banks are lending out a larger proportion of their deposits.
• This trend suggests enhanced financial intermediation and greater participation in economic activities.
• The CD ratio is a key indicator of a bank's liquidity and its ability to fund future growth.

Key Concepts Involved:

• Credit-Deposit Ratio: The ratio represents the proportion of a bank's total deposits that have been advanced as loans.
• Financialization: The increasing role of financial motives, financial markets, and financial institutions in the operation of domestic and international economies.