Defending RBI policies on interest rates, Deputy Governor S S Mundra today said not just cost of capital but other factors are also responsible for low credit offtake.
"There were several factors responsible for that (low credit offtake)," he told reporters on the sidelines of the Gyan Sangam, a two-day bankers' retreat here.
Asked if elevated interest rates have led to low credit growth, Mundra said, "We've articulated several times that there are certain things which are interlinked... The inflation, rate of interest, real rate of interest to the saver.
He said the RBI Governor had clearly articulated in the last monetary policy about what kind of enabling framework would be there.
Growth in credit, "is (a) function of both slowdown in economy and high interest rates," he added.
Meanwhile, on the non performing assets situation, Mundra expressed some optimism but said RBI will be vigilant and continue monitoring the situation.
"The pace of accretion of NPA... In recent quarter (is coming down)," he said.
Despite demand from several quarters, RBI has not cut benchmark interest rates since January 2014.
On the split of post of chairman and managing directors in public sector banks, he said RBI had been recommending this for quite some time.
