As per RBI’s latest data on sectoral deployment in bank credit, non-food bank credit rose 16.0 per cent in August 2022 on a year-on-year (YoY) basis. This has resulted in large corporates reaching out banks to fulfil their working capital requirements.
The latest data on sectoral deployment in bank credit reveals levelled up credit growth to 16 percent in August. The growth is seen after sturdy revival in corporate demand with stable growth in retail, agriculture and loans services.
In comparison with 6.7 per cent a year ago, credit growth to industry accelerated to 11.4 per cent in August 2022 from 1.5 per cent in August 2021
As per RBI’s latest data on sectoral deployment in bank credit, non-food bank credit rose 16.0 per cent in August 2022 on a year-on-year (YoY) basis.
As against a contraction of 2.6 per cent a year ago, loans to large industry went up by 6.4 per cent. This has resulted in large corporates reaching out banks to fulfil their working capital requirements.
At the same time, a growth of 35.6 per cent in loans to the medium size firms was witnessed in August 2022 in comparison with 52.3 per cent last year. Also, credit growth to micro and small industries boosted to 28.2 per cent from 12.1 per cent corresponding to same period.
Credit growth to ‘all engineering’, ‘basic metal and metal products’, ‘beverage and tobacco’, ‘cement and cement products’, ‘chemicals and chemical products’, ‘food processing’, ’glass and glassware’, ‘infrastructure’, ‘leather and leather products’, ‘petroleum, coal products and nuclear fuels’, ‘rubber, plastic and their products’, ‘vehicles, vehicle parts & transport equipment’, and ‘wood & wood products’ increased within the industry, in August 2022 in comparison with previous year’s corresponding month.
However, credit growth to ‘construction’, ‘gems & jewellery’, ‘mining and quarrying’, ‘paper & paper products’, and ‘textiles’ remained low. Also, a growth in Retail loans was witnessed at 19.5 per cent in August 2022 from 12.8 per cent a year ago. It was primarily driven by ‘housing’ and ‘vehicle loans’ segments.
Improved credit offtake to ‘NBFCs’ and ‘trade’ sectors also resulted in credit growth to services sector to 17.2 per cent in August 2022 from 2.1 per cent a year ago. Agriculture and allied activities witnessed a robust credit growth at 13.4 per cent in August 2022 (13.0 per cent a year ago).