New Delhi: While the four metros and big cities such as Bangalore may still make up the major portion of bank deposits, smaller cities are also contributing handsomely to the deposits of commercial banks.
Deposits from cities other than Delhi, Mumbai, Kolkata, Chennai, Pune, Hyderabad and Bangalore, made up 54.71% of the total in the third quarter of 2006-07, according to data available with the Reserve Bank of India (RBI).
Scheduled commercial banks collected more than Rs12,95,000 crore from tier-II and tier-III centres alone in the third quarter of FY07 out of the all-India mobilization of Rs23,67,000 crore.
Bankers attribute the growth to the emergence of new industries in smaller towns and higher income base. “It is not only the big cities of Delhi and Mumbai that are witnessing industrial growth. New industries are coming up in smaller towns as well,” Punjab National Bank executive director K. Raghuraman said.
As this happens, the per capita income of their inhabitants is also increasing. This gives them a considerable amount of disposable income which they park with the banks, another Delhi-based banker said.
Absence of access to share markets and also the higher interest rates being offered by the banks, recently, may be the reasons behind this change.
As per RBI data, the top 100 centres of deposit mobilization contributed Rs16,15,000 crore or 68.2% of total deposits for the quarter ended 31 December against 66.3% in the same quarter a year ago.
However, among the top 100 centres, the share of seven metros was at Rs10,72,000 crore while the remaining 93, spread over tier-II and tier-III centres as well as villages, contributed Rs5,43,000 crore.
In terms of credit or advances, these 100 centres accounted for 77.1% or Rs13,72,000 crore out of the total advances of Rs17,79,000 crore.
In terms of advances, the seven big cities ruled with a total share of 58.01% or Rs10,32,000 crore.
Among the top 100 credit centres, cities or towns other than the top seven accounted for 41.98% or Rs7,47,000 crore of advances. Advances from the top 100 centres stood at 77.1% of the total compared with 76.2% one year earlier.
Mumbai topped, both in terms of deposit mobilization and advances, followed by Delhi.
Mumbai’s deposit mobilization was Rs467,888 crore while for Delhi it was Rs315,466 crore. Banks gave advances of Rs522,465 crore in Mumbai, while for Delhi this figure was Rs211,253 crore.