Mumbai: Hit by high interest rates, growth of commercial credit offtake from banks to major sectors slowed down to 19.6 percent in June, as against 20.2 percent in the same month last year.
While the farm sector and industry reported a lower credit offtake in June vis-a-vis the same month of 2010, the year-on-year growth was higher in case of services and personal loans, as per data released by the RBI today.
The total outstanding non-food or commercial credit was Rs 37.08 lakh crore in June this year, up from Rs 31 lakh crore in the same month of the previous fiscal.
Commercial credit offtake of all sectors combined in June, 2009 was Rs 25.80 lakh crore.
"On a year-on-year basis, non-food gross bank credit increased by 19.6 percent in June 2011 as compared with 20.2 percent in the corresponding period of last year," RBI said.
Earlier this week the RBI revised downward its non-food credit growth projection to 18 percent for this fiscal as against the earlier estimate of 19 percent.
The decline in credit offtake is on account of the RBI's policy of monetary tightening. The apex bank has raised its key policy rates 11 times since March 2010 in a bid to tame inflation, which is currently above 9 percent.
However, the gross bank credit, which also includes food credit, grew by 20 percent in June on an annual basis, as against a growth of 19.5 percent in the same month of 2010.
This is on account of a massive 39.7 percent jump in food credit during the month under review as against a decline of nearly 8 percent in June last year.
Food credit had stood at Rs 76,579 crore in June this year compared to Rs 54,811 crore in June last year. Food credit offtake had stood at Rs 59,506 crore in June 2009.
Last fiscal, non-food credit offtake had increased by 21.5 percent, much above the RBI's projection of 20 percent.
As per the latest data, total credit to agriculture and allied areas grew by only 12.8 percent in June 2011 as against a growth of 21.7 percent in the same month of 2010.
It was Rs 4.53 lakh crore in June, 2011 compared to Rs 4.02 lakh crore in June last year. In June 2009, it was at Rs 3.30 lakh crore.
"Credit to industry increased by 22 percent (year-on- year) in June 2011 as compared with 29.2 percent in the previous year...," the RBI said.
PTI
