The growth is slower than the 27.6 per cent reported in the corresponding period last year but higher than the 20 per cent increase in non-food credit targeted by the central bank in 2008-09.
The rise is partly attributed to the higher demand for funds from public sector oil firms, which are saddled with higher under-recoveries from the sale of products below the prevailing global rates. With oil prices touching $146 a barrel on Thursday, the demand for funds from oil companies is expected to rise further as they will have to deal with more losses.
While the high level of credit growth is expected to put pressure on RBI, bankers expect the demand for funds to moderate in the months ahead due to increase in interest rates.
The growth in accretion of deposits too was higher than the RBI target of 17 per cent. During the first 80 days of the current financial year, deposits of scheduled commercial banks rose 21.95 per cent to Rs 33,54,109 crore, as against Rs 27,50,356 crore between April and June 22, 2007.
This includes demand deposits (those with a tenure of less than a year), which grew 15.7 per cent to Rs 4,60,077 crore, and term-deposits with the scheduled commercial banks grew 23 per cent to Rs 2894031 crore.