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Demonetisation Effect: Cash-Surplus Banks Slash Costly Deposits
November 09, 2017
The high liquidity that resulted from the demonetization move last year has stayed with the banking industry still. This has enabled the banks to cut high-cost deposits and improve their CASA (Current Account and Savings Account) ratio.
According to a study conducted by RBI directors Indrajit Roy and Bhupal Singh, demonetization allowed the banks to enjoy excess deposits of about Rs. 2.8-4.3 trillion. Similarly, senior analyst Udit Kariwala said that about 55% to 60% of the deposits have remained with the banks.
