Consolidated credit growth may slow to 6.8% in FY20: Icra

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Published: November 5, 2019 12:36:22 AM

On a standalone basis, Icra expects bank credit to grow to 8.5% during FY20, down sharply from 13.3% in FY19.

icra, economyOn a standalone basis, Icra expects bank credit to grow to 8.5% during FY20, down sharply from 13.3% in FY19.

The consolidated credit growth in the system — including funds raised through bank credit, corporate bonds and commercial papers (CPs) — may slow to around 6.8% year-on-year in FY20, compared with 13.5% in FY19, rating agency Icra said on Monday.

On a standalone basis, Icra expects bank credit to grow to 8.5% during FY20, down sharply from 13.3% in FY19.

“The incremental credit during FY20 from all these sources (bank credit, corporate bonds and CP outstanding) is likely to decline to Rs 8.3-9.1 lakh crore, from Rs 16.8 lakh crore during FY19,” said Anil Gupta, sector head — financial sector ratings, Icra.

The non-food credit growth in the banking system continued to languish at a new two-year low of 8.72% year-on-year during the fortnight ended October 11, 2019.

Between September 27 and October 11, the non-food credit grew at a mere 0.22% to `97.28 lakh crore, according to provisional data released by the Reserve Bank of India last month.

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