Non-food credit offtake grows at 18.7% in Sept

Non-food credit offtake from banks by major sectors recorded a growth of 18.7% in September this year, notwithstanding the high interest rate regime.

The growth is on par with the expansion in the same month last year.

While the farm sector and the industry reported lower credit offtake in September, it was higher in cases of services and personal loans, as per the latest data released by the Reserve Bank of India (RBI).

"On year-on-year basis, non-food bank credit increased by 18.7% in September 2011, the same as in the previous year," the RBI said.

According to experts, the high growth in personal loan disbursement is on account of festive season and increase in individual spendings. This has led to a high overall rate of credit growth despite high interest rates, they said.

The total outstanding non-food credit disbursement stood at Rs 37.96 lakh crore in September, up from Rs 31.99 lakh crore in the same month of the previous fiscal.

As per the data, the total credit disbursement to agriculture and allied areas grew by only 7.9% at Rs 4.33 lakh crore in September.

"Credit to industry increased by 22.9% in September as compared with 24.4% in the previous year...," the RBI said.

The total credit disbursement to industry -- which includes infrastructure, metals, food processing, rubber, plastic and their products and engineering -- was Rs 17.42 lakh crore in September.

"Credit to the services sector increased by 19.3% in September 2011, higher than 17.4% in the previous year," the RBI said.

The sector saw bank credit offtake rise to Rs 9.12 lakh crore in September this year from Rs 7.64 lakh crore in the corresponding month last year.

Within services, while segments like transport, computer software, tourism and wholesale trade witnessed slower growth in the offtake of credit during the month, disbursements to non-banking financial companies saw a big jump.