As per the Reserve Bank of India’s (RBI) data on ‘Sectoral Deployment of Bank Credit – December 2021’ the bank’s non-food credit registered a growth of 9.3 percent (on a year-on-year (y-o-y) basis) in December 2021 as compared to 6.6 percent in December 2020.
- The improvement in credit growth is mainly due to the credit growth in all 4 segments such as agriculture and allied activities, industry, services and personal loans.
Highlights of the sectoral deployment of bank credit:
i.Credit to Agriculture and Allied activities continued to perform well, registering a robust growth of 14.5 percent in December 2021 as compared to 7.7 per cent in December 2020.
ii.Sectoral Deployment of Bank Credit – December 2021:
| S.no | Sector | December 2021 | December 2020 |
|---|---|---|---|
| 1. | Gross Bank Credit (II + III) | 9.2% | 6.6% |
| 2. | II.Food Credit | -4.2% | 10.8% |
| 3. | III. Non-food Credit | 9.3% | 6.6% |
| 4. | Agriculture and Allied Activities | 14.5% | 7.7% |
| 5. | Industry | 7.6% | 0.4% |
| a.Micro and Small | 20.5% | 1.3% | |
| b.Medium | 86.5% | 17.1% | |
| c.Large | 1.3% | -0.5% | |
| 6. | Services | 10.8% | 8.0% |
| a. Non-Banking Financial Companies (NBFCs) | 13.4% | 3.7% | |
| 7. | Personal Loans | 14.3% | 8.8% |
Key Points:
i.Within the industry, credit growth to all engineering, chemicals & chemical products, infrastructure, mining & quarrying, petroleum, coal product & nuclear fuels, textiles and wood & wood products, etc, accelerated in December 2021 as compared to December 2020.
ii.Credit growth to basic metal & metal products, cement & cement products, construction, food processing, glass & glassware, paper & paper products, etc, have contracted in December 2021 as compared to December 2020.
iii.Housing remained the prime driver of overall growth in the personal loans segment.
Recent Related News:
As per the Reserve Bank of India’s (RBI) annual report namely ‘State Finances: A Study of Budgets of 2021-22’ combined debt-to-GDP (Gross Domestic Product) ratio of states is expected to remain at 31 percent by end-March 2022, which is worryingly higher than the target of 20 percent to be achieved by 2022-23 (FY23).
About Reserve Bank of India (RBI):
Establishment – 1st April 1935
Headquarters – Mumbai, Maharashtra
Governor – Shaktikanta Das
Deputy Governors – Mahesh Kumar Jain, Michael Debabrata Patra, M. Rajeshwar Rao, T. Rabi Sankar
