Banks borrow and lend. They borrow money by accepting deposits from the public including members of the bank. Deposits are the life blood of banking institutions, including rural banks, as they constitute the chief source of funds to undertake lending operations. For profitable operation, the amount of deposits is very important and therefore even banks compete aggressively among themselves for mopping up deposits. The banks should introduce various deposits schemes so that these can attract variety of people to suit their taste. The bank has offered number of deposit schemes to the public which include fixed deposits, saving deposits, current deposits and the like. The mobilization of resources through deposits helps the bank to meet the growing demands from various sectors of the economy namely, agriculture, small scale industry, weaker section of the community and the like. “The quantum of deposits and growth rate in deposit figures show the extent of public confidence that a bank enjoys.” It is the size of the deposits that largely decides the lending potential of a bank. As a result of the green revolution the rural incomes are increasing and it is essential to mop up a portion thereof in the shape of deposits.
Financial Performance, Deposit, Lending and Ratio
