Finance ministry asks banks to work on deposit mobilisation strategies

The Union finance ministry has asked public sector banks (PSBs) to work on strategies to improve deposit mobilisation and submit these soon, according to sources.

 

“The finance ministry has raised that mobilising bank deposits is the issue for the sector. Hence only proper strategy will solve the issue,” said a senior government official who was part of the meeting.

 

The meeting was chaired  by the Department of Financial Services (DFS) Secretary M Nagaraju with the PSB chiefs and select private sector banks.

 

PSBs have seen an aggregate business growth of 11 per cent year-on-year (Y-o-Y) with improved aggregate deposit growth at 9.8 per cent Y-o-Y. The total aggregate business of PSBs has reached Rs 242.27 trillion.

 

However, there is robust credit growth of 12.4 per cent, led by retail credit growth of 16.6 per cent, agricultural credit growth of 12.9 per cent, and micro-, small-, and medium-enterprise (MSME) credit growth of 12.5 per cent.

 

PSBs have recorded a net profit growth of 31.3 per cent Y-o-Y to achieve the highest-ever aggregate net profit of Rs 1.29 trillion and aggregate operating profit of Rs 2.2 trillion in the first nine months of the financial year.

 

The official said that progress of financial schemes, especially announcements made in the Union Budget 2025-26, were discussed at the meeting.

 

“We have been asked to execute the major financial inclusion schemes aggressively such as the Credit Guarantee Fund Scheme for Skill Development, MUDRA (Micro Units Development and Refinance Agency) loan for homestays, Pradhan Mantri Matsya Kisan Samridhi Sah-Yojana, and Kisan Credit Card,” the official said.

 

The finance ministry has also asked for aid from the Fisheries and Aquaculture Infrastructure Development Fund to develop infrastructure for the fisheries sector.

 

“A centralised digital portal may be launched to facilitate real-time tracking of loan applications, subsidies, and financial support for fisheries entrepreneurs,” the official said.

 

The finance ministry has instructed private sector banks to increase their participation in financial inclusion and government schemes.

 

The official further said that a regular review of cases of the National Asset Reconstruction Company was also carried out.