Bank credit increased by Rs 1.19 lakh crore to Rs 111.63 lakh crore during the fortnight ended November 2021. This translates into a year-on-year growth rate of 7.14 per cent compared to 6.8 per cent in the previous fortnight. bulk of loan requisition Most of which is expected to be in the retail sector as consumers have spent a record Rs 1.25 lakh crore this Diwali as per data. Confederation of All India Traders,
The latest data on sectoral flows of credit offtake consumer durable loans showed a 40 per cent increase in September from 14.9 per cent in the same period a year ago, with borrowers taking advantage of lower interest rates.
Moreover, as consumer durable loans have grown by 40 per cent from 14.9 per cent in the same period a year ago, borrowers are taking advantage of lower interest rates.
Deposits increased by Rs 3.35 lakh crore to Rs 160.49 lakh crore during the fortnight. This translates into a growth rate of 11.4 per cent year-on-year as compared to 9.9 per cent in the previous fortnight. Though nearly 50 per cent of deposits are earmarked for investing in IPOs in more liquid demand deposits (Rs 1.45 lakh crore), fixed deposits have also increased by Rs 1.9 lakh crore.
Data from credit bureaus also indicates a pick-up in demand for retail loans during the pandemic period. They are seeing a sharp jump in the demand for loans even after the second lockdown in April. “The latest TransUnion CIBIL’s credit market indicator CMI shows that India’s retail credit market is poised for strong growth, supported by a significant resurgence in credit demand as well as supply, despite a second wave of the pandemic. Rajesh Kumar, Managing Director and CEO, TransUnion CIBIL, said the volume of inquiries has increased by 54% between February 2021 and October 2021, as economic activity picks up. “Lenders have quickly adapted to the shift in new credit origination through digital channels, which has become the new normal in the pandemic environment”.
Lending to medium-sized firms also rose 49 per cent year-on-year to Rs 1.75 lakh crore as of September-end compared to the same period a year ago. Most of the lending is considered under the Emergency Credit Line Guarantee Scheme (ECLGS) of the government. MSME Sectors, under which the government provides 100% guarantee to banks in respect of eligible credit facilities extended to their borrowers.