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Credit growth declines to 3-yr low

Business Standard

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June 17, 2025

Systemic credit growth has declined to 8.97 per cent year-on-year (Y-o-Y) in the fortnight ended May 30, the lowest in three years.

- SUBRATA PANDA

This is owing to lenders prioritizing asset quality over growth amid higher stress in the microfinance and unsecured space.

The last time credit growth in the system was below 9 per cent was in March 2022.

Meanwhile, deposit growth in the system at 9.9 per cent Y-o-Y has outpaced credit growth by 100 basis points (bps).

According to Reserve Bank of India (RBI) data, total deposits in the system stood at 231.7 trillion, while total credit was at 182.8 trillion. During the fortnight ended May 30, deposits increased by ₹2.84 trillion, whereas credit grew by ₹59,885 crore.

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