Credit growth slips to 16.8 per cent

MUMBAI: Although the Reserve Bank projected 20 per cent credit growth this fiscal, expansion in bank loans decelerated to 16.8 per cent during the one-year period ending April 9 against 18.1 per cent in the year-ago period.

As on April 9, banks credit stood at Rs 33.34 lakh crore. In absolute terms, credit expansion was to the tune of Rs 4.79 lakh crore, according to an RBI statement on Wednesday. During the same period last year, bank credit stood at Rs 28.54 lakh crore, 18.1 per cent growth on an annual basis.

In the last fiscal, credit growth stood at 16.9 per cent, above the RBI's projection of 16 per cent. The RBI has estimated the credit to grew by 20 per cent in the current fiscal in its annual monetary policy announced yesterday.

"The growth in non-food credit of banks is placed at 20 per cent. As always, these numbers are provided as indicative projections and not as targets," the RBI said.

Rating agency Crisil's principal economist Dharmakriti Joshi said credit growth is expected to pick up moderately in the coming months. "I expect credit growth to inch up gradually in the coming months. This is mainly due to increase in investment in infrastructure and other related activities. I expect credit to grow by 20-22 per cent in the current fiscal," Joshi added.