In a likely impact of the nudge given by RBI to banks to focus on deposit growth, both deposit and lending rates increased sequentially in July according to the latest data on lending and deposit rates of commercial banks released by the Reserve Bank of India. The weighted average domestic term deposit rate (WADTDR) on fresh rupee term deposits of the commercial banks stood at 6.48 per cent in July 2024 as compared to 6.46 per cent in June 2024. The weighted average domestic term deposit rate (WADTDR) on outstanding rupee term deposits was at 6.92 per cent in July 2024 compared to 6.91 per cent in June 2024.
It may be recalled that on July 19, the RBI had met the commercial banks and nudged them to focus on mobilizing deposits at is the core source of funding loans than from borrowing from the market. In response, many banks raised their deposit rates in late July.
The weighted average lending rate (WALR) on fresh rupee loans at 9.40 per cent in July 2024 was higher than 9.32 per cent in June 2024. The WALR on outstanding rupee loans remained unchanged at 9.91 per cent in July 2024/
The one -year median Marginal Cost of fund-based Lending Rate (MCLR) increased to 8.90 per cent in August 2024 compared to 8.85 per cent in July 2024. In response to the 250 bps policy rate hike since May 2022, SCBs have revised their repo-linked external benchmark-based lending rates (EBLRs) upwards by a similar magnitude.
