Bank credit recorded annual growth of 16% in August; personal loans up 19%


(Representative image) Bank credit records 16% annual growth in August; personal loans up 19%

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Personal loans, driven by borrowing for housing and vehicles, grew by 19.5% in August 2022 from 12.8% a year ago, according to RBI’s recently released Bank Credit Sector Deployment Report. . Retail loans, as a share of all credit disbursed by banks, have increased in recent years.

Meanwhile, overall credit growth on an annual basis (year-on-year) continued to increase in August after stagnating for the past two years due to the pandemic.

Non-food bank credit recorded growth of 16% in August 2022 against 6.7% a year ago.

Credit growth to agriculture and related activities remained robust at 13.4% in August 2022 (13.0% a year ago).

Industrial credit growth accelerated to 11.4% in the month from 1.5% in August 2021. From a size perspective, large industrial credit grew 6.4 % against a contraction of 2.6% a year ago.

Medium industries recorded credit growth of 35.6% from 52.3% last year, while credit growth to micro and small industries accelerated to 28.2% from 12.1% in during the same period.

Within industry, credit growth to ‘all engineering industries’, ‘base metals & metal products’, ‘beverages & tobacco’, ‘cement & cement products’, ‘chemicals & chemical products’, ‘ agro-food’, ‘glass & glassware’, ‘infrastructure’, ‘leather and leather products’, ‘petroleum, coal products and nuclear fuels’, ‘rubber, plastic and their products’, ‘vehicles, vehicle parts and transport’ and ‘wood and wood products’ accelerated in August 2022 compared to the corresponding month of the previous year. However, credit growth in ‘construction’, ‘precious stones and jewellery’, ‘mining and quarrying’, ‘paper and paper products’ and ‘textiles’ contracted.

Credit growth to the services sector accelerated to 17.2% in August 2022, from 2.1% a year ago, mainly due to improved credit provision to the “NBFC” sectors. and “trade”. Personal loan growth improved to 19.5% in August 2022 from 12.8% a year ago, mainly driven by the “housing” and “auto loans” segments.

The RBI collects data on the sectoral deployment of bank credit from 40 selected regular commercial banks representing about 93% of the total non-food credit deployed by all regular commercial banks.


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