Karachi, July 17, 2023 – Pakistan’s salaried class has shown remarkable financial prudence, depositing a staggering Rs3.45 trillion in banks by the end of June 2023. This surge in deposits is primarily attributed to the country’s highest rate of return on investments.
Data released by the State Bank of Pakistan (SBP) on Monday revealed that deposits from salaried individuals witnessed a substantial increase of 16.55 percent, reaching Rs3.45 trillion by the end of June 2023. In comparison, the deposits stood at Rs2.96 trillion in January 2023.
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Experts and analysts believe that the significant growth in banking deposits can be attributed to the record high interest rates offered by banks in the country. As banks provide the best rates of return on investments, the salaried class has been encouraged to deposit their funds in these financial institutions.
It is pertinent to mention here that the benchmark policy rate has been enhanced to record high at 22 percent by the SBP.
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Furthermore, deposits from self-employed individuals also experienced a notable surge, rising by 16.21 percent to reach Rs4.95 trillion by June 2023. In January 2023, the deposits from this group stood at Rs4.26 trillion. Analysts assert that the lack of incentives for industries within the country has compelled business individuals to park their funds in the banking system.
The trend of increased deposits from both the salaried and self-employed classes indicates a growing confidence in the banking sector. The availability of attractive interest rates, coupled with a sense of security, has motivated individuals to entrust their hard-earned money to the banks.
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This surge in bank deposits carries significant implications for the overall economy. Increased deposits allow banks to mobilize funds and extend loans to businesses and individuals, fostering economic growth. Furthermore, it indicates a positive shift in the perception of the banking sector among the general public.
The State Bank of Pakistan has been actively working to create an enabling environment for financial stability and growth. The surge in deposits showcases the effectiveness of the measures taken to incentivize individuals to channel their funds into the formal banking sector.
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As the banking sector continues to witness robust growth in deposits, it is hoped that the 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, leading to a more prosperous Pakistan.
In conclusion, the salaried class in Pakistan has displayed prudent financial behavior, depositing an impressive Rs3.45 trillion in banks by the end of June 2023. This growth in deposits can be attributed to the country’s highest rate of return on investments, which has enticed individuals to deposit their funds in banks. With the banking sector gaining the trust of the public, it is anticipated that these deposits will contribute to economic growth and development in Pakistan.