Withdrawable bank deposit on downtrend

Status of money decreased significantly

Zarif Mahmud: Although the total deposit inflow in the banking sector has slightly increased, the status of deposits as current or withdrawable at any time is now on the downward trend. Due to the economic recession, people’s income has decreased and the standard of living has also decreased. As a result, as people’s money consumption has decreased, the status of deposits has also decreased as it is easy to withdraw money from the bank.
At the same time, there is a recession in business. This has reduced the current account deposit status. At the same time, the growth rate of deposit status as general savings is also very low.
Money can be withdrawn from the bank’s current account and general savings account at any time. Apart from this, there is an opportunity to withdraw money in a short time from the notice withdrawal account and the special notice withdrawal account. According to these also the status of money has decreased.
According to the data obtained from the Central Bank’s report, in the April-June quarter, the bank’s current and cash deposits in June were Tk 1 lakh 57 thousand crore, which increased by 7.55 percent compared to March.
In September it decreased to Tk 1 lakh 49 thousand crores. It has decreased by 5.18 percent or Tk 8 thousand crore compared to June. Current account deposit rate is only 8.70 percent of total deposits.
According to sources, usually businessmen keep cash deposits as current and cash loans. Before spending money in any sector, they deposit it into this account. When the quantitative goal of money is achieved or when the time is fixed, the money is spent. That’s why money doesn’t last long in this account. Besides, the money taken by the businessmen or general customers from the bank, the money is also transferred by the bank. Later, the customer takes money from this account and spends according to demand.
Since Corona there is a slowdown in business in the country. Before economic activity could recover from that, Russia invaded Ukraine in February 2022. This led to a global recession. Its negative impact falls on all sectors of Bangladesh. As a result, there has been a recession in business for four years. Business is suffering severely in this long recession. As a result, investment has decreased. The pace of new employment is also down.
Besides, the central bank has been following a contractionary monetary policy for two years to control high inflation. Due to this, the flow of credit has also decreased. Due to these reasons, as the supply of current account deposits has decreased, so has the balance.
According to the report, the deposit status till June as demand deposits was Tk 2 lakh crore. As of September, the deposit status has come down to Tk 1 lakh 87 thousand crore, which is 11.57 percent of the total deposits. Deposits in this sector fell by Tk 11,000 crore in the July-September quarter of last year. Tk 13,463 crores decreased during the same period of this year. During that period, the deposit status decreased by 6.73 percent.
An official of the central bank said that 6 to 11 per cent of the total deposits are 6 to 11 per cent. As a result, even if the currency status decreases, it will not have any negative impact on the banking sector. The type of bank deposits is like this – sometimes term deposits decrease, current deposits increase. Again, decreases as current, increases as term. Last year term deposits decreased, current deposits increased. Now increasing as term, decreasing as current.
From the report, the status of deposits as withdrawable on special notices has been reduced. According to this, the balance in June was Tk 1 lakh 70 thousand crores. In September, it decreased to Tk 1 lakh 67 thousand crores. At that time the deposit status decreased by Tk 3 thousand crore.
Meanwhile, the pace of credit growth in the private sector has also slowed down. Debt in this sector increased by Tk 28,200 crore in July-September last year. In the same period of this year, it has increased only Tk 18,800 crores. At that time, the increase in credit flow to the private sector decreased by Tk 9,600 crore.
Total deposits in the banking sector till September stood at Tk 17 lakh 14 thousand crores. Deposits increased by 1.55 percent.