India Banking Sector Report 2025 Q2

The banking sector in India is expected to see a moderation in credit growth in FY2025 after experiencing robust expansion in FY2024. According to ICRA's estimates, credit growth is projected to slow down to 11.6-12.5% in FY2025, compared to the record high of 16.3% (INR 22.3tn) observed in FY2024. This anticipated slowdown is largely attributed to recent regulatory measures implemented by the Reserve Bank of India. These include directives to reduce the credit-to-deposit ratio, increase risk weights on exposures to rapidly growing loan segments, and proposals to review the liquidity coverage ratio (LCR) framework. These actions collectively aim to bring credit growth more in line with deposit growth. Despite the expected moderation, credit growth is likely to continue outpacing deposit growth. As a result, the credit-to-deposit (CD) ratio is expected to remain elevated in the near term. ICRA suggests that any significant reduction in the CD ratio may take some time to materialize, indicating ongoing pressure on banks to balance their loan books with their deposit base. This outlook reflects the banking sector's need to adapt to regulatory changes while managing growth in a sustainable manner. It also highlights the ongoing challenge for banks to maintain adequate liquidity while meeting credit demand in the evolving economic landscape.

This report provides a complete and detailed analysis of the "Banking and insurance" sector for India. EMIS Insights presents in-depth business intelligence in a standard format across countries and regions, providing a balanced mix between analysis and data.

What this report allows you to do:

• Understand the key elements at play in the "Banking and insurance" sector in India
• Crystallise the forces both driving and restraining this sector in India
• Ascertain India’s position in the global sector
• Build a complete perspective on sector trade, investment and employment
• Understand the competitive landscape and who the major players are
• View M&A activity and major deals
• Gain an understanding of the regulatory environment for the sector in India.
• Build a clear picture of trends, output and consumption for specific sub-sectors