Due to stagnation in investment and new business initiatives amid the coronavirus pandemic, the amount of bank deposits by businessmen and industrialists increased in 2020 compared to the previous year.
Compared to 2019, the deposits increased by more than Tk17,000 crore in 2020 or about 12.6%, according to the scheduled bank statistics report released by the central bank on Thursday.
However, the amount of deposits did not increase so much in the normal economic situation throughout 2019. Compared to 2018, deposits increased by about Tk13,000 crore or 10.4% in that year.
About the increase in deposits by businessmen and industrialists, Abul Kashem Khan, former president of the Dhaka Chamber of Commerce and Industries (DCCI), told The Business Standard that over the past year, businesses have been unable to make any new investments due to uncertainties amid the pandemic, which has led to an increase in their savings.
On the other hand, investment increased in 2019 due to normal conditions, so the amount of deposits did not increase that year, he added.
Syed Mahbubur Rahman, managing director of Mutual Trust Bank, said that the huge growth of remittances throughout the year 2020 is one of the reasons for the increase in deposits of the businesses and the banking sector as a whole.
He said a portion of this remittance has also helped businesses increase their deposits. In addition, their deposits have increased due to lower imports over the last year.
The bank account through which businesses transact every day is known as the current account.
An analysis of the central bank's data shows that in 2019, the amount of money in the current accounts decreased by 15.15%, but in 2020, the amount of money has increased by more than 22% despite a slowdown in the business during the pandemic.
Asked about this, Syed Mahbubur Rahman said, "If there is an increase in business and trade transactions, there is less money in current accounts. In addition, lower interest rates on deposits and lower costs of such accounts may have encouraged banks to open more current accounts for businesses."
Apart from this, the current accounts opened by many small entrepreneurs have also had an impact as many new types of businesses have been launched amid the Covid-19 last year.
Analysis of the data shows that the lion's share of businesses' deposits last year were in the form of savings and fixed deposits. Out of the total deposits of over Tk1.5 lakh crore, more than Tk83,000 crore were fixed deposits and more than Tk33,000 crore were savings deposits.
Overall, last year the number of bank accounts has increased by more than 92 lakh as compared to that of 2019, and exceeded 11.58 crore. The amount of deposits in these accounts has increased by more than Tk1.64 lakh crore to about Tk13.80 lakh crore.
Like every year, the Dhaka division was at the forefront in terms of deposits. The total deposits in this division are more than Tk8 lakh crore. And in the most backward Mymensingh division, the amount of deposit was only Tk20 thousand crore.