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SBI Reports Decline in Credit Growth
April 24, 2017
According to SBI, since there has been a steep decline in the credit growth currently, although the economy is growing at 7%, it’s likely because there is a decoupling of the GDP and credit growth.
According to the data provided by the Reserve Bank of India, loan growth has dropped to an abysmal 5.08% in FY 2016-17, which is almost a 50% drop from last year’s 10.7%. This is the lowest reported credit growth since fiscal 1953-54 when the credit demand grew by only 1.7%.
SBI managing director Rajnish Kumar said that the significant drop is linked to the fact that industrial demand for credit has weakened, and balance sheets of banks also showing signs of impairment.
