Personal loans continue to drive bank credit growth, RBI says
RBI said yesterday that bank credit growth continued to be driven by growth in personal loans, which accounted for 27.4% of total credit in September 2021, up from 25.0% a year ago and 19.3% five years ago.
Demand for bank credit from the industrial sector moderated during the COVID-19 pandemic; its share of outstanding loans fell to 28.0% in September 2021, from 29.9% a year ago.
As the demand for bank credit from the private enterprise sector continued to moderate and the share of household sector credit2 increased further, the share of borrowers with relatively small loans (with a credit limit of up to one crore Rs.) rose to 47.2 percent of the total. credit against 44.4% a year ago and 37.1% five years ago.
The share of female individual borrowers in total credit stood at 9.8% in amount and 31.3% in number of credit accounts in September 2021; their share in the additional credit in the last year (September 2021 compared to September 2020) was over 20.5% in loan amount and 44.8% in terms of number of accounts.
Private sector banks continued to lead the expansion of lending and increased their share in total credit to 37.5% in September 2021, from 35.9% a year ago and 26.4% a year ago. five years.
The weighted average borrowing rate (WALR) on outstanding loans fell by 10 basis points (bps) in the quarter ended September 2021 and by 61 bps in the last year.
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