Deposit franchise

A bank's ability to gather low-cost, sticky deposits, which is the durable competitive advantage in lending.

With ₹22,000 crore of current and savings balances in ₹55,000 crore of deposits, a bank has 40% of its funding at little or no cost.

Banks build it over decades through branches, salary accounts, payment relationships and trust. It can't be bought quickly at any price, and so it's a moat. A competitor can match any loan product within a quarter and can't match the funding cost for a decade.

Everything else about a bank can change over the years. This is the part that persists.