Scheduled commercial banks’ non-food credit growth was a shade slower at 5.9 per cent in June 2021 against 6 per cent in June 2020 due to deceleration in credit growth to industry and services sector.

However, credit to agriculture and allied activities and personal loans segments showed accelerated growth.

According to the Reserve Bank of India’s statement on ‘Sectoral Deployment of Bank Credit – June 2021’, credit to agriculture and allied activities continued to perform well, registering an accelerated growth of 11.4 per cent in June compared to 2.4 per cent in June last year

Credit to industry

Credit growth to industry contracted by 0.3 per cent in June 2021 from 2.2 per cent growth in June 2020. Size-wise, credit to medium industries registered a robust growth of 54.6 per cent in June 2021 compared to a contraction of 9.0 per cent a year ago.

Credit growth to micro and small industries accelerated to 6.4 per cent in June compared to a contraction of 2.9 per cent a year ago, while credit to large industries contracted by 3.4 per cent in June compared to a growth of 3.6 per cent a year ago.

The RBI said credit growth to the services sector decelerated to 2.9 per cent in June 2021 from 10.7 per cent in June 2020, mainly due to contraction/ deceleration in credit growth to ‘commercial real estate’, ‘NBFCs’, ‘tourism, hotels and restaurants’.

However, credit to the ‘trade’ segment continued to perform well, registering accelerated growth of 11.1 per cent in June 2021 compared to 8.1 per cent a year ago.

Personal loans registered an accelerated growth of 11.9 per cent in June 2021 compared to 10.4 per cent a year ago, primarily due to accelerated growth in ‘loans against gold jewellery’ and ‘vehicle loans’.

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