Banks turn wary post IBC, tighten lending norms for labour-intensive units

RBI data shows a sharp fall in growth of outstanding loan for sectors like tea, textiles, glass and gems & jewellery

Banks are tightening their lending norms for some labour-intensive sectors. Particularly those at the lower end of mechanisation.

Data from the Reserve Bank of India (RBI) shows a sharp fall in growth of loan dues for the tea, textiles, glass and gems & jewellery sectors.

For tea, year-on-year, this growth fell from 32 per cent in 2017 to three per cent in 2019. Textiles (which includes) went from 7.6 per cent growth in 2017 to a fall of 5.4 per cent in 2019. For gems and jewellery, from 0.7 per cent growth to a 11.1 per cent fall.

With most also under-performing in