Commercial credit offtake slows to 19%

Commercial credit offtake slows to 19%

While farm sector and industry reported lower credit offtake in July, 2011, vis-a-vis the same month of 2010, year-on-year growth was higher in case of services and personal loans, as per the latest data released by the RBI.

Total outstanding non-food or commercial credit disbursement stood at Rs 37.28 lakh crore in July this year, up from Rs 31.35 lakh crore in the same month of the previous fiscal. Commercial credit offtake of all the sectors combined was Rs 26.13 lakh crore in July, 2009.

The decline in credit offtake is on account of the RBI’s monetary tightening policy. Gross bank credit, which also includes food credit, grew by 19.1 per cent in July on an annual basis, as against a growth of 19.8 per cent in the same month of 2010. This is on account of massive 31.9 per cent jump in food credit offtake during the month under review, as against a mere 9.2 per cent growth in July last year.

Food credit offtake stood at Rs 67,461 crore in July this year, compared to Rs 51,281 crore in July last year. Food credit offtake had stood at Rs 46,971 crore in June, 2009. Last fiscal, non-food credit offtake increased by 21.5 per cent, much above RBI’s projection of 20 per cent.

As per latest data, total credit disbursement to agriculture and allied areas grew by only 11.8 per cent in July, 2011, as against a growth of 19.9 per cent in the same month of 2010. It was Rs 4.43 lakh crore in July, 2011, compared to Rs 3.96 lakh crore in July last year. In July, 2009, it stood a Rs 3.30 lakh crore.

On an annual basis, total credit disbursement to industry -- which includes infrastructure, metals, food processing, rubber, plastic and their products and engineering -- was Rs 16.79 lakh crore in July, compared to Rs 13.85 lakh crore in the same month last year.

The sector saw bank credit offtake rise to Rs 9.06 lakh crore in July this year from Rs 7.47 lakh crore in the corresponding month last year. In July, 2009, the figure was Rs 6.36 lakh crore. Within services, while segments like transport, computer software, tourism and wholesale trade witnessed slower growth in the offtake of credit during the month, disbursements to non-banking financial companies saw a big jump.

Bank credit disbursement to NBFC segment stood at Rs 1.73 lakh crore in July this year, as against Rs 1.11 lakh crore in the same month last year.

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