India’s rural centres are now leading the country’s fixed deposit (FD) expansion, reversing a trend that long saw metropolitan areas driving deposit growth, according to the Reserve Bank of India’s latest data.Rural FD balances jumped 14% year-on-year to Rs 9.7 lakh crore in the September quarter, significantly outpacing the 10% rise in metro centres to Rs 86 lakh crore. Savings deposits in rural regions also grew 10%, marking their fastest increase in six quarters, ET reported.Bankers said rising rural incomes have strengthened deposit mobilisation, while growth in metros is slowing as financially savvy customers increasingly divert savings to mutual funds, equities and other higher-yield products. The RBI categorises centres based on population: rural (under 10,000), semi-urban (10,000–99,999), urban (100,000–1 million) and metro (over 1 million).The latest surge marks a sharp shift from last year’s pattern. In the June 2024 quarter, metro FD growth stood at 17%, outpacing rural growth of 14.8%. By the September 2024 quarter, both stood at around 14% each. But by March 2025, metros slowed to 13%, while rural deposits rose 15%. The divergence widened further in June 2025, with rural FD growth at 16% compared with 12.5% in metros.Total bank FDs grew 11.3% year-on-year to Rs 145.8 lakh crore in the September quarter, slowing from 14.4% in the corresponding period last year.Urban and semi-urban centres have also lagged rural regions. In the September quarter, FD growth in urban areas was 12% and semi-urban centres 13%, down from 15.4% and 17.5% respectively in the June 2024 quarter.“Customers in rural and semi-urban areas prefer safety over high returns. Therefore, they prefer bank FDs,” a senior private bank retail head said, adding that rising financial awareness in metros is pushing more savings into market-linked products.
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