AHMEDABAD: Subdued economic and commercial activities during the pandemic year coupled with lower capital expenditure by companies bolstered the growth rate of bank deposits in Gujarat to 16%, which is the highest since fiscal 2017 when a similar growth was recorded on the back of demonetisation.
Banks in Gujarat saw their deposits swell by Rs 1.21 lakh crore to Rs 8.81 lakh crore in 2020-21 from Rs 7.6 lakh crore in 2019-20, states the latest data released by the State Level Bankers’ Committee (SLBC).
“Due to the lockdown, the economic and commercial activity was drastically reduced.
Hence, withdrawals took a hit as people did not have many avenues to spend money.
Even as the lockdown eased, the economic activity remained slow both for companies as well as individuals.
Consequently, the bank deposits grew,” said M M Bansal, convener, SLBC – Gujarat.
Sources also said that due to job losses as well as slowed growth in business, consumer confidence took a major hit, which curtailed overall spending.
“Pandemic brought uncertainty and therefore, people were faced with both financial as well as health-related emergencies.
As a result, most people understood the importance of savings, which also boosted the surge in bank deposits,” Bansal further added.
The last time the growth in deposits was so high was in 2016-17, soon after demonetisation.
At that time, bank deposits showed a growth of Rs 85,654 crore, according to SLBC.
SINGLE UPI transactions up 120% in 9 mths Online education and work from home are not the only indicators of a rapid shift to the digital world but a surge in online payments too is a strong indicator of this paradigm change.
In last three quarters of fiscal 2021, transactions made through Universal Payments Interface (UPI) jumped by 120% in Gujarat from 12.75 crore as of June 2020 to Rs 28.12 crore by March 2021, shows data released by the state level bankers’ committee (SLBC) – Gujarat.
“Due to the pandemic there was a great deal of reluctance among the general public in using cash.
Moreover, most of the banks-PSU and private–onboarded the UPI platform, which pushed up such transactions,” said Bansal.