By Shashank Didmishe
Personal loans continue to remain the key driver for banks’ non-food credit growth, with the segment consistently showing more than double-digit growth so far this year. Credit to the services sector and corporate loans also continue to show growth offshoots.
Banks’ personal loan outstanding stood at Rs 35.2 trillion as of June 17, higher by 18% YoY, Reserve Bank of India (RBI) data show. The segment has witnessed a clockwork growth of close to 2 percentage points on a month-on-month basis between April and June.
Analysts and bankers have said that personal loan growth will continue to improve in the current financial year. A clutch of private sector banks and select public sector banks have witnessed significant improvement in personal loans during Q1. HDFC Bank and ICICI Bank have posted personal loan growth of 22% and 38%, respectively.
The personal loans constitute close to 30% of the total non-food credit outstanding as of June 17.
In comparison, banks’ loans outstanding to the services sector marginally moderated to 12.8% in June, compared with 12.9% in May. As on June 17, total outstanding to the services sector stood at Rs 30.7 trillion. Bank lending to NBFCs consists of nearly 40% of the total outstanding to the services sector. Bank loans to NBFCs have improved 20% in June to Rs 11 trillion.
Credit outstanding to industry grew 9.5% in June, with loans to micro and small industries growing by 29% and to medium industries by 47.6%.