Non-food credit growth slows to 6.8% in May

MUMBAI: The non-food credit growth decelerated to 6.8% year-on-year in May from 11.4% in the same period of last year, RBI data showed.

The outstanding incremental non-food credit stood at Rs 90.3 lakh crore as of May 22, 2020, as against Rs 84.51 lakh crore on May 24, 2019.

In April, non-food credit growth decelerated to 7.3% on a year-on-year basis from 11.9% in the same month last year. Bank loan growth to industry decelerated to 1.7% in May from 6.4% in the same month last year.

"Within industry, credit growth to beverage and tobacco, petroleum, coal products and nuclear fuels, and paper and paper products accelerated," according to the RBI's release on Sectoral Deployment of Bank Credit - May 2020.

However, credit growth to chemicals and chemical products construction, infrastructure, food processing, textiles, and all engineering decelerated/contracted. Credit growth to agriculture and allied activities decelerated to 3.5% during the reporting month from 7.8% in May 2019, as per RBI data.

Loans growth to the services sector slowed down to 11.2% from 14.8% in the same month of last year.

Personal loans growth decelerated to 10.6% in May 2020 from 16.9% in May 2019, RBI said.

In other news, Direct investment into the country rose by USD 19 billion while portfolio investment declined by USD 13.7 billion during 2019-20, according to the data on the International Investment Position (IIP) released by RBI.

International financial assets of Indian residents increased by $73.9 billion due to the rise in reserve assets and overseas direct investment by $64.9 billion and $13.0 billion, respectively, though other investments declined marginally during the year, RBI said.