MUMBAI: After a dip in October, retail loan growth accelerated in November, paced by demand from home and car buyers, with petrol and diesel prices falling from their 2018 highs.On a year-on-year (y-o-y) basis, retail loans increased 17.2 per cent to Rs 20.6 lakh crore in November, compared with 16 per cent in October, latest Reserve Bank of India (RBI) data showed.
By contrast, non-food bank credit increased by a slower pace of 13.8 per cent.The pace of retail growth has significantly picked up in November with oil prices declining and possibly acting as a boost to discretionary spending that was declining before October, SK Ghosh, chief economic advisor at State Bank of India, said in a report.
The pick-up in retail credit growth is all more encouraging as November was witness to 10 holidays across country, Ghosh said in report.
RBI data also showed that credit to industry has accelerated again in November after a lackluster October, with food processing, fertiliser, iron steel, cement, petroleum and infrastructure (roads and power) leading way.But incremental credit to NBFCs declined further in November ( Rs 3,700 crore against Rs 16,000 crore in October and Rs 56,500 crore in September), while flows to medium and small enterprises showed a negative growth.
It is, however, possible that credits to MSE picked up in December following launch of new on-line scheme in November, Ghosh said.