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Credit-deposit ratio (CD ratio) — India’s banking system

Q: What is the credit-deposit (CD) ratio?

The credit-deposit (CD) ratio is total bank credit (loans and advances) expressed as a percentage of aggregate deposits. A CD ratio of 80% means a bank has lent out 80 rupees for every 100 rupees of deposits it holds. It is a headline measure of how much of a bank's deposit base is deployed as credit, and of the funding and liquidity headroom that remains.

Q: Why does a high CD ratio matter for banks?

A persistently high CD ratio means credit is growing faster than deposits, so banks must fund loans from costlier sources such as bulk deposits, certificates of deposit or borrowings. That raises the cost of funds, can squeeze the net interest margin and leaves less liquidity buffer. The RBI flags an elevated system CD ratio in its Financial Stability Report and nudges banks to mobilise more retail deposits.

Q: What CD ratio does the RBI consider comfortable?

There is no statutory cap, but the RBI has generally treated the high-70s to about 80% range as the upper edge of a comfortable band for the system. Individual banks vary widely — foreign banks have historically run higher ratios, while some public-sector banks run lower. A very low CD ratio can signal under-lending, while a very high one signals funding stress.

Quick answerThe all-India CD ratio of scheduled commercial banks was about 80.21% for the fortnight ended 31 Oct 2025 — near the upper edge of the RBI’s comfort band. It touched a roughly 61-year high of ~80.8% in March 2025 before easing to about 78.9% by June 2025 as deposit growth caught up with slower credit growth. A high CD ratio means banks are lending close to the limit of their deposit base — raising the cost of funds and pressuring margins.

All-India CD ratio

80.21%

SCBs · fortnight ended 31 Oct 2025

61-year high

80.8%

March 2025

RBI comfort band

~75–80%

upper edge of the system range

Recent CD-ratio readings

Period	CD ratio	Note
Mar 2025	80.80%	~61-year high — credit ran well ahead of deposits
Jun 2025	78.90%	eased as deposit growth (~10% y/y) caught up
31 Oct 2025	80.21%	latest web-verified fortnightly print

Figures are web-verified all-India readings for scheduled commercial banks (credit as a percentage of aggregate deposits). For the exact fortnightly and quarterly series, and the bank-group and state-level splits, see the RBI source linked below.

How to read the CD ratio

The CD ratio is the simplest gauge of a bank’s funding balance: how much of every rupee of deposits has been turned into loans. When the credit growth rate runs ahead of deposit growth, the ratio climbs and the bank must plug the gap with bulk deposits, certificates of deposit or market borrowings — all dearer than retail CASA money. That lifts the cost of funds and squeezes the net interest margin. The ratio is not capped by regulation, but a system reading in the high-70s to ~80% is widely seen as the top of the RBI’s comfort zone; the central bank flagged the elevated CD ratio in recent Financial Stability Reports and urged banks to chase deposits.

What it means for bankers

For an asset-liability management (ALM) desk, the CD ratio is a daily structural-liquidity signal. A rising ratio tightens the room under the SLR and CRR after statutory pre-emptions, pushes up reliance on the CD market and the LAF window, and shapes deposit-pricing strategy. Treasuries watch it alongside the call money rate to judge how hard the system is straining for funds; branch and retail teams read it as the cue to harden deposit mobilisation. A sustained gap between credit and deposit growth is the single clearest driver of the trend.

Key terms in this dataPlain-English definitions of the terms behind this dashboard — see the full Indian banking glossary. CASA · NIM · SLR · CRR

More live dataExplore BankPulse’s other live RBI dashboards: Credit & Deposit Growth · CASA Ratio · Net Interest Margin · SCB Deposits · CP & CD Market.

Credit-deposit ratio FAQ

What is the credit-deposit (CD) ratio?

The CD ratio is total bank credit (loans and advances) shown as a percentage of aggregate deposits. A CD ratio of 80% means a bank has lent 80 rupees for every 100 rupees of deposits. It is a headline read on how much of the deposit base is deployed as credit and how much funding and liquidity headroom remains.

What is India's current CD ratio?

The all-India CD ratio of scheduled commercial banks was about 80.21% for the fortnight ended 31 Oct 2025. It hit a roughly 61-year high near 80.8% in March 2025, then eased to about 78.9% by June 2025 as deposit growth (~10% y/y) caught up with slower credit growth.

Why does a high CD ratio matter for banks?

When credit grows faster than deposits the CD ratio rises, and banks fund the gap from costlier sources — bulk deposits, certificates of deposit or borrowings. That lifts the cost of funds, can compress the net interest margin and thins the liquidity buffer. The RBI highlights an elevated system CD ratio in its Financial Stability Report and presses banks to mobilise more retail deposits.

What CD ratio does the RBI consider comfortable?

There is no statutory cap, but the RBI has broadly treated the high-70s to about 80% range as the upper edge of a comfortable band for the system. Banks differ widely — foreign banks have historically run the highest ratios while some public-sector banks run lower. A very low ratio can signal under-lending; a very high one signals funding stress.

Last reviewed 19 Jun 2026 by Vikram Jain

Source: RBI Quarterly Statistics on Deposits & Credit of Scheduled Commercial Banks & Weekly Statistical Supplement, rbi.org.in; CD-ratio levels web-verified (Jun 2026). Reviewed by Vikram Jain. Last updated 19 Jun 2026, 15:03 IST.