Non-food credit growth slips in July, but stays above 10%
The outstanding non-food credit disbursement by schedule commercial banks stood at Rs 76,276 billion by the end of July 2018.
Niti Kiran New Delhi Last Updated: September 4, 2018 | 23:21 IST
Non-food credit, which accounts for 99.4 per cent of the gross bank credit, showed signs of slowdown after three consecutive months of growth. The growth, however, remained above 10 per cent for the fourth successive month.
The outstanding non-food credit disbursement by schedule commercial banks stood at Rs 76,276 billion by the end of July 2018, recording a year-on-year (y-o-y) growth of 10.6 per cent, a 60 percentage points below the growth figure of 11.1 per cent in the preceding month.
The non-food credit growth remaining above 10 per cent for the fourth month in a row is significant as it was restricted to single digits over the last eighteen months between October 2016 and March 2018 with an exception of 10 per cent growth in the December 2017.
The industrial sector, which contributes the maximum of around 35 per cent share in non-food credit, saw a meagre growth of 0.3 per cent compared to 0.9 per cent rise in the preceding month. Outstanding loans to services sector and personal loans contributed almost equally-- 26.3 per cent and 25.5 per cent, respectively.
The growth in outstanding loans to services sector rose by 23 per cent in July 2018 compared to 23.3 per cent growth in June 2018. Personal loans growth slowed to 16.7 per cent after rising by 17.9 per cent by end-June. The agriculture & allied sector which accounts for 13.6 per cent share in the total non-food credit has seen a growth of 6.6 per cent in July 2018 compared to the outstanding credit of Rs 9,743.2 billion by the end of July 2017.