Hit by high interest rates, growth in commercial credit offtake from banks by major sectors slowed to 18.9% in July, 2011, from 20% in the same month last year.
While the farm sector and industry reported lower credit offtake in July, 2011, vis-a-vis the same month of 2010, year-on-year growth was higher in case of services and personal loans, as per the latest data released by the RBI.
Total outstanding non-food or commercial credit disbursement stood at Rs 37.28 lakh crore in July this year, up from Rs 31.35 lakh crore in the same month of the previous fiscal.
Commercial credit offtake of all the sectors combined was Rs 26.13 lakh crore in July, 2009.
"On a year-on-year basis, non-food gross bank credit increased by 18.9% in July, 2011, as compared with 20% in the corresponding period of last year," the RBI said.
The RBI had last month revised its non-food credit growth projection for this fiscal downward to 18% from the earlier estimate of 19%.
The decline in credit offtake is on account of the RBI's monetary tightening policy. The apex bank has raised its key policy rates 11 times since March, 2010, in a bid to tame inflation, which is currently above 9%.
Gross bank credit, which also includes food credit, grew by 19.1% in July on an annual basis, as against a growth of 19.8% in the same month of 2010.
This is on account of a massive 31.9% jump in food credit offtake during the month under review, as against a mere 9.2% growth in July last year.
Food credit offtake stood at Rs 67,461 crore in July this year, compared to Rs 51,281 crore in July last year. Food credit offtake had stood at Rs 46,971 crore in June, 2009.
Last fiscal, non-food credit offtake increased by 21.5%, much above the RBI's projection of 20%.
As per the latest data, total credit disbursement to agriculture and allied areas grew by only 11.8% in July, 2011, as against a growth of 19.9% in the same month of 2010.
It was Rs 4.43 lakh crore in July, 2011, compared to Rs 3.96 lakh crore in July last year. In July, 2009, it stood a Rs 3.30 lakh crore.
"Credit to industry increased by 21.2% (year-on- year) in July, 2011, as compared with 27.7% in the previous year...," the RBI said.
On an annual basis, total credit disbursement to industry -- which includes infrastructure, metals, food processing, rubber, plastic and their products and engineering -- was Rs 16.79 lakh crore in July, compared to Rs 13.85 lakh crore in the same month last year. It stood at Rs 10.84 lakh crore in July, 2009.
However, there was a moderate increase in the rate of growth of credit offtake from banks by the services sector.
"Credit to the services sector increased by 21.3% (year-on-year) in July, 2011, up from 17.4% in the previous year," the RBI said.
The sector saw bank credit offtake rise to Rs 9.06 lakh crore in July this year from Rs 7.47 lakh crore in the corresponding month last year. In July, 2009, the figure was Rs 6.36 lakh crore.
Within services, while segments like transport, computer software, tourism and wholesale trade witnessed slower growth in the offtake of credit during the month, disbursements to non-banking financial companies saw a big jump.
"Credit growth to NBFCs at 55.6% on a year-on- year basis in July, 2011, was significantly higher than that of 10.9% growth during the corresponding period of the previous year," the apex bank said.
Bank credit disbursement to the NBFC segment stood at Rs 1.73 lakh crore in July this year, as against Rs 1.11 lakh crore in the same month last year. Credit disbursement to NBFCs stood at Rs 10.03 lakh crore in July, 2009.
Credit extended to the personal loans sector also went up by 15.4% during July, 2011, compared to a growth of 8% during the same month a year ago.
During the month under review, total credit offtake by the sector stood at Rs 6.98 lakh crore, as against Rs 6.05 lakh crore in July, 2010. In July, 2009, the sector had availed credit to the extent of Rs 5.60 lakh crore.