Deployment of bank credit: retail trade is advancing at full speed, according to CARE Ratings



oi-Sunil Fernandes


Non-food credit growth accelerated to 6.8% year-on-year in September 2021 from an increase of 5.1% in September 2020, with growth of 162 basis points (bps) year-on-year and 07 bp monthly. Months (mom) due to the easing of lockdown restrictions and the start of the festival season, CARE Ratings said.

“Growth has been driven by the retail, agriculture and industrial and service segments, with services growing slowly. the Kharif harvest, ”CARE Ratings said in a report
Retail / personal loans

“The credit of the retail / retail lending segment (currently the largest segment) grew 12.1% year-on-year in September 2021 (similar to the growth rate seen in August 2021) mainly due to growth housing, vehicles, loans against gold jewelry and other personal loans (sub-segments) due to the holiday season and the gradual opening of the Indian economy. SBI’s retail loan portfolio grew 15.2% in the second quarter of FY22, outpacing growth in consumer loans from India’s banking sector, “the rating agency said.
According to him, according to media comments, real estate listings in Mumbai registered a 35% year-on-year increase in September 2021, while residential sales from January to September 2021 increased by 47% in India’s seven major cities.

“Home loans (50.7% retail share) rose 9.0% in September 2021 compared to 8.2% growth a year ago. The home loan segment has also been driven by growth in affordable housing and low interest rates. The other personal loans (share of 29% in the retail trade) increased by 18.2% in September 2021 against a growth of 11.4% a year ago. Besides the private sector banks, the main public sector units SBI and BoB for the growth of unsecured loans through their digital platforms, ”said Care Ratings.

“The home loan segment has also been driven by the growth of affordable housing and low interest rates. Durable consumer goods (0.4% share in retail trade) recorded significant growth of 40% in September 2021 against growth of 14.9% per year. outstanding credit cards (share of approx. 4.0% in retail trade) increased by 9.5% during the period considered. 42.3% in September 2020. SBI’s gold loan portfolio recorded strong growth of 338.7% in Q1FY22, driven by essential medical needs and job losses due to the second wave of Covid- 19, however, growth moderated to 91% in Q2FY22. individuals versus stocks, bonds, etc., and education registered a decline of 25.4% and 2.9%, respectively, during the review period. -growth over the period, ”he noted.

Regarding the priority sector, Care Ratings noted that the total priority sector loans increased by 5.6% to 39.6 Lakh crore in September 2021, driven by the growth of agriculture and related activities, micro and small industries and weaker sections due to ELCGS scheme and higher production estimated for Kharif production.

Article first published: Thursday, November 11, 2021, 11:22 AM [IST]


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