Bank Credit Growth Slows To 5.8% In September Quarter, Shows RBI Data
Indian two thousand and five hundred rupee banknotes are arranged for a photograph in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Bank Credit Growth Slows To 5.8% In September Quarter, Shows RBI Data

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Bank credit growth decelerated to 5.8% in the September quarter from 8.9% in the year-ago period, according to the Reserve Bank of India data.

Aggregate deposits of banks rose 11% year-on-year in the July-September period as compared to 10.1% growth a year ago, according to the 'Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks, September 2020' - released by the Reserve Bank of India.

The deceleration in bank credit growth was seen across all the population groups rural (11.2% vs 14.8%), semi-urban (9.4% vs 12.3%), urban (8.7% vs 9.9%) and metropolitan (3.6% vs 7.2%), the data showed.

Annual growth (year-on-year) in credit by private sector banks moderated significantly to 6.9 per cent in September 2020 from 14.4% a year ago, whereas it increased marginally for public sector banks to 5.7% from 5.2% over the same period last year, it said.

The share of current account and saving account in total deposits has been gradually increasing. It stood at 42.3% in September 2020 compared to 41.2% a year ago and 40.8% hree years ago, the data showed.

Also read: Raghuram Rajan’s Message To India: Fix Structural Issues In Banking, Don’t Take Shortcuts

As deposit growth exceeded credit growth, the all-India credit-deposit ratio declined to 72% in September 2020 from 73.1% in the previous quarter.

Credit-deposit ratio for metropolitan branches, which have a dominant share in bank deposits and credit, stood at 88.4% in September 2020 (90.9% a quarter ago). The ratio for Tamil Nadu, Andhra Pradesh and Chandigarh remained above 100%, the data showed.

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