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Banks’ credit growth nearly doubles in FY22


Bank credit growth in the preceding fiscal hit 9.6% against a 5.6% growth seen in FY21, data shows. Deposit growth slowed to 8.9% in FY22 from 11.4% in the same period in the corresponding year.

According to data released by the Reserve Bank of India (RBI), total bank credit stood at Rs 118.9 lakh crore as on March 25 – the last reporting Friday for FY22. This was a growth of Rs 1.8 lakh crore during the fortnight and Rs 10.4 lakh crore during the financial year, registering a year-on-year growth of 9.6%.

A Rs 1.8-lakh-crore surge in lending in mid-March helped banks add Rs 10.4 lakh crore to their loan books in FY22. This is almost double the Rs 5.8-lakh-crore growth registered in FY21.

Bank deposits stood at Rs 164.7 lakh crore – an increase of Rs 1.9 lakh crore during the fortnight and Rs 13.5 lakh crore during FY22. The growth in bank deposits during the year was 8.9%.

Credit continues to be driven by retail lending. On the wholesale side, part of the growth is due to the shift from money markets to loans as the central bank started withdrawing excess liquidity. Also, the surge in commodities like oil has increased the demand for working capital.

The recovery in credit was driven by the private sector banks, which accounted for a little over half of the credit growth (50.4%) with public sector banks contributing 44.7%.



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