New Delhi, April 14 -- Banks and non-banking financial companies relied heavily on raising short-term funds from capital markets to meet the shortfall in their capital amid persistently tight system liquidity through most of FY25.

Fundraising through commercial papers (CPs) was the highest in FY25 in the last three years, whereas funding through certificates of deposit (CDs) was the highest in the last five years, according to data by primedatabase.com.

CDs are typically issued by banks, whereas corporates issue CPs. Both are short-term money market instruments used to raise funds ranging from a tenor of one week to up to one year.

As per the data, CDs worth Rs.13.2 trillion were issued by banks in FY25 compared with Rs.9.6 trillion in...