Banks' credit down 2.91%

Credit in the banking system has declined by 2.91 per cent from the start of this financial year (April 1). According to the Reserve Bank of India data, bank credit fell from Rs 68,30,965 crore at the end of April 3 to Rs 66,32,101 crore by the end of May 15. In the same period, deposits also declined by 1.92 per cent

However, credit in the system grew 10.16 percent at the end of May 15 as compared to the corresponding period a year earlier. Deposits in the same period inched up 11.8 per cent.

With credit demand in the banking system continuing to remain sluggish, credit growth has been hovering either in single digits or the low double digit range.

Reflecting an economic slowdown in the country, the pace of growth in bank credit slowed to 9.52 per cent in 2014-15, compared with 13.83 per cent in 2013-14.

Bankers believe credit growth has continued to remain under pressure due to slowdown in the corporate segment of the business.

Those in the sector say that the activity in the corporate side has remained mainly limited to working capital loans.