Keeping savings bank interest rates largely unchanged amid rising policy rates since mid-2022 has been shrinking the share of current and savings accounts (Casa) in banks' overall deposits for a while. However, it still remains far below levels of pre-demonetization years.
Casa ratio of the banking system stood at 31.6% at the end of 2014, and surged to 37.8% in 2016 as cash flooded into savings accounts after demonetization. It continued to rise and peaked at 42.9% in December 2021, but has fallen since then, touching 39.3% at the end of December 2023, data from rating agency Icra and Mint calculations showed.
"Casa ratio shot up after demonetization and reached its peak during covid-19, prior to which it used to be in early to midthirties levels," said Anil Gupta, senior vice-president and co group head of financial sector ratings, Icra Ltd. Casa levels should remain "comfortably above midthirties", Gupta said.
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