Showing signs of demand uptick in the economy, gross bank credit of scheduled commercial banks (SCBs) grew in double digit for the first time since demonetisation and GST implementation. According to the monthly data released by the Reserve Bank of India on Monday, gross bank credit rose 10.4 per cent in April 2018 (highest in 19-months) led by strong growth in credit demand by service and personal loan segment, even as industry demand for credit stood low at 1 per cent.
The RBI data shows that the credit demand for services sector jumped 20.7 per cent in April and the demand for personal loans rose 19.1 per cent. Agriculture and allied activities too witnessed a 5.9 per cent rise in credit demand from the banks. While the credit outstanding of SCBs rose by Rs 7.1 lakh crore from Rs 68,981 billion in April 2017 to Rs 76,130 billion in April 2018, almost 90 per cent of the growth was contributed by services and personal loan segment. It is important to note that the two segments account for 51 per cent of the total credit outstanding of scheduled commercial banks.
The Industrial sector that accounts for almost 35 per cent of the total credit outstanding of banks saw a growth of 1 per cent in April 2018 over that in the previous year.