Unlocking the wealth of Goa’s bank deposits – The Navhind Times
Goa's abundant bank deposits should be channelised into investments within the state, writes Dr. Suresh Shanbhogue
Goa is a high liquidity economy with strong household savings and inflows. The state has excellent bank network covering every nook and corner. Goa is a bank deposit surplus state with banks utilizing the same in other states due to the low credit potential locally.
As per the State Level Bankers Committee (India) data, as on March 31, 2025, Goa recorded a total deposit of Rs 1,25,974.31 crore and advances amounting to Rs.38,887.42 crore, reflecting a credit-deposit ratio (CDR) at 30.87%, which is much below the national average of 83%. The per capita bank deposit of Goa, at nearly Rs. 8 lakh is one of the highest in the country and several times more than the national average of around Rs 1.5 lakh. The Gross State Domestic Product is nearly equal to the total deposits held by the banks in Goa.
The number of bank branches over the years has increased from 258 in 1980-81 to 801 as on March 31 2025 (SLBC, India). The latest official taluka-wise and bank-wise data published by the state government for 2022-23, shows that, there are 753 bank branches comprising 641 commercial bank branches and 112 co-operative bank branches. There are 32 commercial banks comprising State Bank of India as the lead bank (91 branches) followed by Union Bank of India (71), Canara Bank (69), HDFC (68) and balance by other banks.
The co-operative sector is led by Goa State Co-operative Bank (55 branches) followed by Goa Urban Co-operative Bank (16) and Bicholim Urban Co-operative Bank (11). The concentration (70.8%) of bank branches is seen in four talukas viz. Salcete (22.2%), Bardez (20.5%), Tiswadi (18.3%), and Mormugao (9.8%). In terms of population covered per bank branch, Goa is far ahead (around 2000) of national average (around 10,000).
Goa is also a remittance dominated economy. Goan diaspora across the globe sends money to their home state as NRE deposits. As on March 31, 2023, the total NRE deposit of Rs 23,313 crore is a significant number considering the small size of the diaspora abroad.
Large number of households in Goa, though an official estimate is not available (guestimate 1 in 4 Goan households), are believed to be dependent on remittances both domestic and international. Goa is not just a tourism economy; it is also a remittance supported consumption economy. The economic effects are visible in terms of reasonably good standard of living and low visible poverty, but distorted labour force participation because of their ability to stay idle there being no compulsion to take up low-wage jobs.
Thus, the story is that Goa has surplus money that can be channelized for fruitful purposes. The present focus of State Level Bankers Committee along with the state government towards priority sector lending, Jan Dhan accounts, financial inclusion etc is no doubt worth applauding, which alone is not sufficient to leverage high credit potential of banks in Goa.
A vision could be transformation from a consumption led economy to investment bound economy. The government may have to create a strong partnership with the local banks so that all investments done in Goa are through the pipeline of Goa banking system. Presently, though lots of investment in different sectors is happening in Goa, their loan requirements may be majorly met from the bank branches outside Goa.
Therefore, the Goa government could explore a strong policy decision that for all types investments in Goa credit requirements needs to be met through the bank branches in Goa only. There has to be a platform to disseminate information to the banks in Goa regarding potential investors including various infrastructure projects of the Government so that the banks in Goa will be able to tap such investment opportunities.
The CDR of Goa has historically remained at around 30%. Goa need to go on a mission mode to double the CDR to at least 60%. For this, the state need to think out of the box options beyond business-as-usual scenario. The state may build a unique financial ecosystem to ensure strong local investment using substantial idle savings towards achieving sustained high-income growth.
Presently, Real Estate Investment Trusts (REITs) are dominant in the private and institutional sector in India to act as a bridge between real estate assets and investors, making property ownership more liquid, accessible and income-generating.
In Budget 2026, the union government has proposed dedicated REITs to monetize land of central public sector enterprises. No state government has set up REIT so far. Goa can become the first state in the country to evolve a 'Trust' model on the lines of REIT, which could be Goa REIT or Goa Asset Monetization Trust (GAMT) or Goa Infrastructure and Investment Trust (GIIT).
Such a trust will have natural advantage of excess liquidity available with the banks and can facilitate immediate financial closure mechanism for various infrastructure projects, PPP projects, asset monetisation projects, tourism led projects and various investment related projects in different sectors of the economy.
It may also be an opportunity for such a Trust to participate in Goa's state development loans floated through RBI to meet its fiscal deficit requirements. The Trust may even participate in State Development Loans of other states. However, evolving such a Trust require a suitable financial architecture compliant to all legal and regulatory provisions and a highly professional institutional mechanism. The tag line is that Goa has surplus cash in its banks, which can be productively used towards achieving its ambitious goal of Viksit Goa 2037.
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