Non-food credit growth of scheduled commercial banks (SCBs) decelerated to 5.6 per cent in October from 8.3 per cent in October 2019, mainly due to contraction in credit to industry and deceleration in personal loans growth.
Credit to industry contracted by 1.7 per cent as compared with 3.4 per cent growth in October 2019, according to Reserve Bank of India’s data on sectoral deployment of bank credit.
This data has been collected from select 33 SCBs which account for about 90 per cent of the total non-food credit deployed by all SCBs.
Credit to large industries
The contraction in credit to industry is due to contraction in credit to large industries by 2.9 per cent against a 4.2 per cent growth a year ago, the central bank said.
However, credit to medium industries registered a robust growth of 16.7 per cent (1.2 per cent).
Within industry, credit to food processing, petroleum, coal products and nuclear fuels, leather and leather products, paper and paper products and vehicles, vehicle parts and transport equipment registered accelerated growth.
However, credit growth to beverage & tobacco, rubber, plastic and their products, chemical and chemical products, cement and cement products, all engineering, gems and jewellery, infrastructure and construction decelerated/contracted, RBI said in a statement.
Personal loans registered a decelerated growth of 9.3 per cent in October 2020 as compared with 17.2 per cent growth in October 2019.
Within this sector, vehicle loans continued to perform well, registering accelerated growth of 8.4 per cent (5 per cent).
Agri and services
Credit growth to agriculture and allied activities accelerated to 7.4 per cent (7.1 per cent), while that to
the services sector accelerated to 9.5 per cent (6.5 per cent).
Within this sector, credit to professional services, computer software and trade registered accelerated growth in October 2020 vis-à-vis the growth in the corresponding month of the previous year.