Credit growth at 5 years high

Credit growth at 5 years high

Why in News?

loan growth of commercial banks is at a five-year high on the back of strong demand, latest data released by Reserve Bank of India (RBI) 

Highlights:

*According to the data, year-on-year credit growth was 14.6% as on October 26, the highest in five years. In October 2013, credit growth was 16.6%.
*According to bankers, the credit growth started picking up by the end of August-early September.
*The month of September alone saw credit offtake of ₹2 lakh crore out of ₹3 lakh crore credit disbursed during the April-September period.
*The October data corroborates the pick-up in credit growth that started in September.
*Credit to major sectors like infrastructure, textiles, chemical and chemical products and engineering has accelerated. Retail credit is also growing at a healthy pace, particularly housing loans.
*Credit growth had returned for SBI with the bank recording 11.11% year-on-year growth till September. The country’s largest lender expects 10-12% loan growth for the current financial year.
*Deposit growth, despite picking up was still lagging credit growth with the gap between deposit and credit growth widening. According to RBI data, deposit growth was 9% for the fortnight ended October 26.
Credit growth at 5 years high Credit growth at 5 years high Reviewed by The Hindu Current Affairs on November 10, 2018 Rating: 5

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