Credit growth to industry nil in Sept, banks pick services sector for loans

Personal loans grew 9.2 per cent year on year in September: compared to 16.6 per cent in September 2019

Credit growth to industry was nil while banks increased lending in the services sector on a year-on-year basis in September, according to data from the Reserve Bank of India (RBI).

Personal loans grew 9.2 per cent year on year in September, as compared with 16.6 per cent in September 2019. Vehicle loans grew the most among in the personal loan segment. Credit to agriculture and allied activities increased by 5.9 per cent in September as compared with a growth of 7 per cent in September 2019. 

Growth in credit to industry was nil in the year to September, but it had grown at 2.7 per cent year on year in September 2019.  

Credit to food processing, petroleum, coal products and nuclear fuels, leather and leather products, wood and wood products, and paper and paper products registered credit growth in September. Credit growth to beverage and tobacco, construction, infrastructure, rubber plastic and their products, chemical and chemical products, glass and glassware and all engineering decelerated or contracted. 

Credit growth to the services sector accelerated to 9.1 per cent year on year at the end of September from 7.3 per cent a year ago. Within this sector, credit to computer software, trade and tourism, hotels & restaurants registered higher growth. 

Overall, on a YOY basis, non-food bank credit growth decelerated to 5.8 per cent in September 2020 from 8.1 per cent in September 2019, the RBI said.