Banks sit on Rs1.56 trillion in excess liquidity as weak credit demand persists

Weak credit demand, sluggish economic activity and robust remittance-driven deposit growth leave lenders flush with funds, raising questions over the economy’s recovery.

With just a week remaining in the current fiscal year as of July 10, banks and financial institutions are sitting on Rs1.56 trillion in lendable funds, reflecting a persistent surplus of liquidity in the financial system.