There is more liquidity in the banking sector. Banks' credit investment has not expanded while interest rates have been declining. Thus, when banks reduce interest rates, deposits are bound to flow.

Bank officials say that after the banks started giving low interest rates, the depositors have started keeping them in the cooperatives. Lately, the number of deposits in banks has decreased. As the interest rate has gone up, the general public has started gravitating towards cooperatives.

According to NRB, deposits of banks and financial institutions have increased by 18.7 percent in the last fiscal year. Such deposits had increased by 18 percent in the previous year. Current, savings and time deposits accounted for 10 percent, 31.9 percent and 48.6 percent of the total deposits of banks and financial institutions, respectively. Such share was 9.7 percent, 32.8 percent and 46.3 percent respectively in the corresponding period of the previous year. That is, there is a lot of time.

If we look at the statistics of the last five years, the largest share of deposits in the banking and financial sector has been occupied by time. If you look at the statistics of the last five years, the share of savings deposits in banks has been decreasing while the term is increasing.

The share of savings in total deposits was 43.3 percent in mid-July 2012/13. In 2074 BS, it decreased to 35.4 percent and in 2075 BS, it decreased to 34.4 percent. The declining share of savings has not stopped. The share of savings, which had declined to 32.8 percent in mid-July 2076 BS, has come down to 31.9 percent by mid-July 2077 BS.

Although ordinary deposits are declining, term deposits have been increasing for the past five years. The share of term deposits increased from 30.5 percent in mid-July 2073 BS to 43.2 percent in 2074 BS. This sequence continued till 2075, 76 and 77. In these years, the share of time deposits has been 44.8, 46.3 and 48.6 percent respectively.