Banks’ deposit mobilisation and credit disbursal through digital modes are set to experience exponential growth, according to a recent survey by the Reserve Bank of India (RBI). Conducted in March 2024, the survey covered 25 banks and 68 non-banking financial companies (NBFCs).
The survey is part of the RBI’s recent report on Currency and Finance.
Currently, banks mobilise only a small portion of their deposits through digital channels. However, the importance of digital modes is rapidly increasing. The survey revealed that within five years, 44% of banks expect to collect more than half of their deposits online. On the lending side, about three-fourths of the surveyed banks currently extend up to 10% of their total lending through digital modes. Looking ahead, 33% of banks anticipate that they will lend more than 50% digitally within the next five years. These trends are expected to significantly enhance credit deepening in India.
Growing collaboration
Additionally, the survey highlighted the growing collaboration between banks, NBFCs, and fintech firms. A notable 84% of banks and 35% of NBFCs reported partnering with fintech companies to offer digital banking solutions. These collaborations are instrumental in distributing products and services through digital platforms. The survey also indicated that 92% of banks find these partnerships effective in driving digital innovation, compared to 60% of NBFCs.
