Bank credit grows 6.24%, deposits rise 11.28%

MUMBAI:

Bank credit

and

deposits

grew 6.24 per cent and 11.28 per cent to Rs 102.54 lakh crore and Rs 139.55 lakh crore, respectively, in the fortnight ended June 5, according to the latest data from

the Reserve Bank of India

(RBI).


In the fortnight ended June 7, 2019, bank loans had stood at Rs 96.51 lakh crore and deposits at Rs 125.40 lakh crore.

On a fortnightly basis, bank advances grew 0.3 per cent or Rs 32,022.49 crore to Rs 102.54 lakh crore in the week to June 5 as against Rs 102.22 lakh crore in the week ended May 22, 2020.

Deposits grew 0.9 per cent, or Rs 1.25 lakh crore, on a fortnightly basis, the RBI data showed.

In a recent report, Crisil Ratings had said that bank credit growth is likely to nosedive to a multi-decadal low of 0-1 per cent this fiscal as economic activity is sharply impacted by the COVID-19

pandemic

.

According to India Ratings and Research, the sudden spike in bank deposits over the past few months is on account of a rise in overall borrowings of both central and state governments and not due to an increase in savings.

In April, the outstanding incremental non-food credit growth contracted 1.2 per cent to Rs 91 lakh crore, from Rs 92.12 lakh crore in March, the RBI data had showed.

On a year-on-year basis, non-food credit growth decelerated to 7.3 per cent in April 2020 from 11.9 per cent in the corresponding month last year, the data showed.

Loan growth

to agriculture and allied activities decelerated to 3.9 per cent in April 2020, from 7.9 per cent in April 2019.

Growth in advances to the services sector decelerated to 11.2 per cent from 16.8 per cent in April 2019.

Personal loan growth decelerated to 12.1 per cent in April 2020 from 15.7 per cent in April 2019.