“Scheduled commercial banks’ (SCBs) credit growth slowed to 9.8 per cent as on May 16, 2025, compared to last year growth of 19.5 per cent,” said the SBI report released on Friday, May 30, 2025.
The bank credit reduced by ₹15,676 crore during April to May this year, highlighting a negative year-to-date (YTD) growth of 0.1 per cent. However, bank credit growth was reported at ₹1.68 lakh crore or 1 per cent YTD during the same period previous year.
Deposit growth
Deposit growth marginally declined from the previous year. During April to May this year, deposits grew by ₹3.06 lakh crore or 1.4 per cent YTD from ₹3.39 lakh crore or 1.7 per cent YTD in the same period last year.
How did other sectors performed?
The sector-wise credit in April 2025 slowed down in all sectors. Agriculture and allied activities credit rose by 9.2 per cent, lower than 19.8 per cent a year ago, while industrial sector credit grew by 6.6 per cent, down from 7.4 per cent in April 2024.
However, there was a marginal increase in credit for sectors such as basic metal and metal products, engineering, vehicles and transport equipment, textiles, and construction, while credit growth in the infrastructure sector slowed down.
In terms of the services sector, credit growth fell to 10.5 per cent this year from 22.0 per cent in 2024. This was largely attributed to a significant decrease in lending to non-banking financial companies (NBFCs). Nevertheless, credit for sectors like trade and computer software continued to be strong.
Slowdown in personal loans
The personal loans sector experienced a slowdown as growth dropped to 14.5 per cent year-on-year from last year’s 17.0 per cent. This decline was primarily due to a decrease in growth rates for vehicle loans, credit card balances, and other personal loans.
The overall trend indicated a widespread slowdown in credit demand across the economy during the early months of the FY26.
