In the budget, banks also expect the government to boost consumption demand and investment through reduction in corporate as well as personal income tax. In fact, 53% of the respondent banks reported a substantial increase in CASA deposits and attributed the same to demonetisation, besides their own efforts to mobilise opening of savings account. Notably, in the previous survey round, only 25% of respondents had reported a substantial increase, while 50% had reported a moderate increase in such deposits. With a thrust on less-cash economy, banks are also eyeing additional incentives for digital transactions, including tax benefits for customers as well as merchants. While 76% of the participating banks reported a rise in the level of NPAs during July-December, 85% had reported so for the preceding six month period.

Source: Mint January 29, 2017 07:52 UTC