Pakistan's salaried class boosts bank deposits to Rs3.45 trillion
Pakistan's salaried class has showcased commendable financial
discipline, propelling bank deposits to a remarkable Rs3.45 trillion by the end
of June 2023. This surge in deposits can be primarily attributed to the
country's highest rate of return on investments, a driving factor behind the
increased confidence in the banking sector.
Data released by the State Bank of Pakistan (SBP) on Monday
revealed an impressive 16.55 percent growth in deposits from salaried
individuals, reaching Rs3.45 trillion by June 2023. In comparison, these
deposits stood at Rs2.96 trillion in January 2023.
Experts and analysts credit the significant growth in banking
deposits to the record high interest rates offered by banks in the country. As
financial institutions provide the best rates of return on investments, the
salaried class has been encouraged to deposit their funds, acknowledging the
attractive opportunities for growth and security.
It is noteworthy that the benchmark policy rate has been
elevated to a record high of 22 percent by the SBP.
Furthermore, deposits from self-employed individuals also
experienced a noteworthy surge, rising by 16.21 percent to reach Rs4.95
trillion by June 2023. In January 2023, deposits from this group stood at
Rs4.26 trillion. Analysts attribute this growth to the lack of incentives for
local industries, leading business individuals to prefer parking their funds in
the formal banking system.
The upward trend in deposits from both the salaried and
self-employed classes signals a growing confidence in the banking sector. The
availability of attractive interest rates, coupled with a sense of financial
security, has motivated individuals to entrust their hard-earned money to
banks.
This surge in bank deposits holds significant implications for
the overall economy. Increased deposits enable banks to mobilize funds and extend
loans to businesses and individuals, fostering economic growth. Moreover, it
reflects a positive shift in the perception of the banking sector among the
general public.
The State Bank of Pakistan's proactive efforts to create an
enabling environment for financial stability and growth have proven effective.
The surge in deposits is a testament to the success of measures taken to
incentivize individuals to channel their funds into the formal banking sector.
As the banking sector continues to witness robust growth in
deposits, it is hoped that these funds will be effectively utilized to support
the economy. The increased availability of funds for lending purposes is
expected to stimulate business activities and promote investment, contributing
to a more prosperous Pakistan.