Agri, retail, MSME credit growth quickens

The pace of lending to agriculture, retail, and micro, small and medium enterprises (MSMES) gathered pace in July over the same month in 2020, reflecting gradual uptick in business activity and demand in the economy.

However, the growth yearon-year in gross bank credit in July at 6.1 per cent was still lower than 6.5 per cent a year ago, revealed the RBI.

Credit to agriculture and allied activities continued to perform well, registering an accelerated growth of 12.4 per cent in July, compared to 5.4 per cent in July 2020.

Retail loans clocked a growth of 11.2 per cent in July, compared to 9 per cent a year ago, primarily due to higher activity in loans against gold jewellery and vehicle loans.

Credit growth to industry remained subdued at 1 per cent in July vis-à-vis 0.9 per cent in July 2020. Sizewise, credit to medium industries registered a robust growth of 71.6 per cent in July, compared to a contraction of 1.8 per cent a year ago. Credit to micro and small industries accelerated to 7.9 per cent in July, compared to a contraction of 1.8 per cent a year ago.