Credit offtake up 19.6% during 12 months to Sep 23
High interest rate regime notwithstanding, non-food credit offtake from banks grew by 19.6% to over Rs 42 lakh crore during 12 months to September 23.
October 05, 2011 / 19:15 IST
High interest rate regime notwithstanding, non-food credit offtake from banks grew by 19.6% to over Rs 42 lakh crore during 12 months to September 23.
According to the Reserve Bank data, credit offtake during the period was Rs 42.21 lakh crore, against Rs 35.28 lakh crore during 12 months to September 24, 2010.The year-on-year credit growth had fallen below 19% in mid-July, but has picked up again since August on renewed borrowing.Meanwhile, deposits went up to over Rs 56.85 lakh crore till September 23 this year, as against Rs 48.55 lakh crore as on September 24, 2010 -- clocking a rise of 17.1%. According to experts, while borrowings by industry and services have been affected on account of high interest rates, the ongoing festive season has led to demand in the personal loans segment.In its first quarterly monetary review in July, RBI had said that credit growth was likely to slow down as a result of the recent rate hikes.RBI said credit growth would be around 17-18% this fiscal, as against the earlier projection of 19%, while deposit growth has been pegged at 17%. During 2010-11, bank credit had increased 21.5%, while deposits grew by only 15.5%. Corporate India has complained that frequent rate hikes have resulted in slowing down of investments and industrial growth.In fact, industrial growth plunged to a 21-month low of 3.3% in July. The country's economic growth was also down 7.7% in the April-June period, the slowest in six quarters.The Reserve Bank has hiked its key rates 12 times since March 2010 to curb inflation, which has been above the 9% mark since December last year. It was at 9.78% in August, the highest in 13 months. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
