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Housing, NBFC loans spur credit growth
Why is it in the news?
- Banks’ credit growth started picking up at the onset of the festive season.
- It is spurred by loans to retail sectors like housing and non-banking financial sector.
- The credit growth had been contracting for several months before it took upward.
More in the news
- Credit growth on a year-on-year basis was at 8.2% as at September end.
- Loans to industry were in the positive territory in the month of September.
- Housing and NBFCs:
(1) Banks had extended ₹38,417 crore to the housing sector between August 30 and September 27, followed by Rs. 33,150 crore to the NBFC sector.
(2) Credit growth on a year-on-year basis was 19.3% for the housing sector and 30.5% for the NBFC sector.
- Policy rate cut:
(1) To boost credit demand in a slowing economy, the RBI cut interest rates sharply in 2019, with the repo rate falling 135 basis points between February and October.
Source
The Hindu.