Non-food credit growth was at a two-year low of 7.49% year-on-year (y-o-y) for the fortnight ended December 6, according to provisional data released by the Reserve Bank of India (RBI).
Non-food credit growth, after witnessing a short-lived uptick due to the festive season and ‘loan melas’ organised by the public sector banks (PSBs), continued its declining trend as of early December. After slipping to a single-digit record low of 8.69% during the fortnight ended September 27, the non-food credit growth rose marginally to 8.79% in late October, buoyed by the festival season.
The growth posted for the fortnight ended December 6 is the lowest since the fortnight ended October 27, 2017, when the y-o-y growth came in at 6.4%.
The finance ministry had earlier announced that public sector banks had disbursed Rs 4.91 lakh crore in two months — including Rs 2.52 lakh crore in October and Rs 2.39 lakh crore in November — to MSMEs, NBFCs, corporates, retail and agriculture sector borrowers.
Outstanding loans to companies and individuals stood at Rs 98.1 lakh crore, up from Rs 91.27 lakh crore during the comparable fortnight of 2018. Between November 22 and December 6, non-food credit rose 0.41% from Rs 97.7 lakh crore.
Deposit growth in the banking system rose 10.28% y-o-y to `131.05 lakh crore during the fortnight under review. During the comparable fortnight of 2018, deposits with banks had grown by 8.87%. The credit-deposit (CD) ratio for the fortnight stood at 74.85%, down from 75.4% in the previous fortnight.
Source: Financial Express