Disaggregate credit data by RBI show manufacturing firms slowed down borrowings. Loan offtake to industry grew just 14.7% in February, slower than 19.1% in the same period last year, dragging non-food credit growth to 14.4%.
Within manufacturing, loans to medium-sized firms slowed the most and contracted 10% against growth of 17% a year ago. In contrast, loans to services sector and retail loans grew at a healthy pace.
Banks had disbursed R10,95,700-crore loans to the services sector as on February end, a growth of 12.7% year-on-year. Barring shipping companies, loans to all category companies in services grew at a healthy pace. Loans to shipping companies fell 30%.
Retail loan growth was stronger at 13.5% y-o-y driven mainly by home loans and auto loans. Housing loans grew by 13.5%, faster than 11.4% a year ago while auto loans expanded by 21%.
Loans for consumer durables contracted. Credit card outstanding grew a whopping 24%. Card outstanding had grown by just 10.7% a year ago.