Bank credit growth in FY21 to hit multi-decade low of 0-1%: CRISIL

Prior to the disruption caused by covid-19, bank credit was already slower than normal in FY20 due to subdued economic activity and risk averseness of the lenders

The bank credit growth may fall to a multi-decade low of 0-1 per cent in 2020-21, from 6 per cent growth in FY20, due to the economic disruptions caused by Covid-19, rating agency CRISIL has estimated. 

Due to the economic contraction, the banking sector is expected to witness one of its slowest years, the rating agency said. The bank credit was already slower than the usual standards in FY20 because of subdued economic activity and risk averseness of the lenders. 

With Covid-19 unfolding into an unprecedented crisis, the bank credit growth is expected to shrink by 5 per cent in a base