In the financial year 2020-21, bank deposits rose by 22% to a record high of Rs 19.8 trillion, including government, private sector, and household deposits.
According to Topline Research, as of June 30, 2020, bank deposits stood at Rs 16.2 trillion. The growth rate of bank deposits of 22% is the highest in 14 years.
Arif Habib’s research head, Tahir Abbas, says the boom in economic activity has boosted the incomes of businesses and individuals and has led to an increase in bank deposits.
In the last financial year, the country’s economy grew at a rate of 4%, while in 2019-20, the economic growth rate was only 0.5%. The government has set a growth target of 4.8 percent for the current financial year.
According to Topline Research, remittances from overseas Pakistanis also played a key role in increasing bank deposits, reaching a record high of 29 29.4 billion.
Ahmed Ali Siddiqui, head of product development and senior executive vice president of Shariah Compliance at Meezan Bank, says the government has taken huge loans from commercial banks to boost the budget deficit, promote digital banking and print more banknotes. Bank deposits also increased.
