At the second quarter review of the monetary policy RBI had cut credit growth projection for 2012-13 by one percentage point to 16%. Bankers said marginal fluctuations in credit offtake were normal expect demand for loans to pick up. Bankers also said they were noticing a marginal improvement in credit demand and said the retail segment was seeing the biggest uptick.
There is a slight improvement in credit demand from most segments and the retail segment continues to grow, said MS Raghavan, executive director of Bank of India.
Meanwhile, in the fortnight to January 11, 2013 banks' deposits grew at 13.28% y-o-y to Rs 65,38,595 crore, higher than in the previous fortnight when deposit growth was just 11.05%, which was a nine year low. Between April last year and now deposit growth has been 6.97%, over the corresponding period of 2011-12, according to the latest data.
In the second quarter review, RBI had projected deposit growth of 15% for FY2012-13. Bankers said deposits may be hard to come by since high inflation has prompted companies to invest in gold and real estate and banks are unable to increase deposit rates in such an environment. High inflation along with appreciating gold prices hit deposits this year and the growth in the current account and saving accounts has been hit the most, said SL Bansal, chairman and managing director of Oriental Bank of Commerce.