Credit to MSME rises amid muted growth; personal loans jump 20.4% in Feb

Credit to industry remained muted, with 1 per cent growth in February against a contraction of 5.2 per cent in the year-ago period, according to the Reserve Bank of India data.

This was lead by a 4 per cent growth in credit to micro and small enterprises, followed by a rise of 2.3 per cent and 0.4 per cent, respectively, to medium and large enterprises.

“Credit to major sub-sectors such as textiles, chemical and chemical products, engineering, food processing, and rubber, plastic and their products accelerated. However, credit to infrastructure, basic metal and metal products, cement and cement products, and petroleum, coal products and nuclear fuels contracted,” said the central bank.

Total non-food bank credit increased 9.8 per cent in February 2018 to ~73,390 billion against an increase of 3.3 per cent in February 2017.

Personal loans increased 20.4 per cent in February against an increase of 12 per cent a year ago. Housing (including priority sector housing) credit grew 16.5 per cent against 11.4 per cent in February last year.

Credit to the services sector increased 14.2 per cent, up from 7.7 per cent in February 2017, while that to agriculture and allied activities increased 8.4 per cent. Overall credit to the priority sector grew 6.8 per cent. This was against an agricultural credit growth of 4.7 per cent and priority sector growth of 8.7 per cent in February 2017.