)
Credit in the banking system continues to grow at only a tepid pace, despite the festival offers extended by lenders.
Reserve Bank of India data suggests it rose 0.3 per cent between November 28 and December 12. However, in the past one year, credit growth was up 10.8 per cent, to Rs 63,03,482 crore.
“Some reduction in interest rates would help. In the present rate structure, deposit growth is higher than loan growth, which shows banks are flush with funds, implying the price of credit needs to adjust,” said Ashima Goyal, an external member of RBI’s technical advisory committee and professor of economics at the Indira Gandhi Institute for Development Research.
Deposits fell 0.3 per cent in the past fortnight. In the past one year, deposits grew 10.6 per cent, to Rs 82,929,75 crore.
