At a time when banks are finding it challenging to mobilise resources, State Bank of India (SBI) — the country’s largest lender — has devised a three-pronged strategy to boost deposit accretion.
First is an aspirational product that promises to make depositors lakhpatis by helping them grow their deposits to Rs 1 lakh through recurring deposit (RD) schemes.
“RDs are the original systematic investment plans (SIPs),” says SBI chairman C S Setty.
“Earlier, people would ask when their deposits would double.
"One product we are working on is Har Ghar Lakhpati — a goal of saving Rs 1 lakh by encouraging RDs.
"It is important to create that narrative. We want to create goal-oriented deposits,” Setty told Business Standard during an interaction.
The second product SBI is developing offers depositors the option to allocate a portion of the interest earned on fixed deposits (FDs) to mutual funds and another portion to create a pension corpus.
“Our idea is: if someone opens an FD product with us, how do we combine FD, RD, SIP, and the National Pension System (NPS)?” Setty said.
“NPS is gaining ground. We are suggesting that interest earned from an FD be allocated partly to SIPs and partly to NPS.
"This way, while maintaining a corpus in FDs, depositors can participate in the equity growth story and simultaneously create a pension pool,” he added.
SBI is planning to introduce both schemes this month.
As of the end of September, SBI’s deposit base stood at Rs 51 trillion, which has since grown to roughly Rs 52 trillion.
While the bank has garnered nearly Rs 2 trillion in deposits in the first six months of the current financial year (2024-25), year-on-year (Y-o-Y) growth has remained below 10 per cent.
Deposit mobilisation has been challenging for banks over the past two years as savers increasingly allocate resources to the booming stock markets and alternative investment avenues.
Deposit growth has also lagged behind credit growth, prompting the Reserve Bank of India (RBI) to urge lenders to develop innovative products.
However, deposit growth has recently matched credit growth due to a sharp decline in loan demand.
According to the latest RBI data, Y-o-Y deposit growth was 11.2 per cent for the fortnight ending November 15, compared to 11.1 per cent for loan growth.
SBI, which has a sizeable number of high networth and wealthy depositors, is ramping up its service capabilities for such customers.
“We are focusing on premium banking customers — those with good relationship value with us in the form of deposits.
"They may not be interested in wealth advisory but seek quality banking services.
"They want a relationship manager (RM), someone they can talk to. So, we have created a premium banking service with almost 2,000 RMs on the ground,” Setty said.
In the wealth management space, the bank is focusing on two aspects.
First, physical relationship managers. SBI plans to increase their number from 450 to 1,500, focusing exclusively on high-networth individuals.
SBI identifies wealth customers as those with a relationship value exceeding Rs 30 lakh.
Second, is the technology platform.
“We have completely revamped our integrated wealth management solution, our technology platform, where customers can view all investments made through SBI Wealth services in one place,” Setty added.
SBI is opening an average of 60,000–65,000 savings accounts daily through its vast branch network of 22,500 branches across the country.
It remains to be seen how these new initiatives will boost the lender’s deposit drive.
