Reflecting a slowdown in the manufacturing sector, bank credit to industry — large, medium and small — shrunk by 1.9 per cent in FY17 against 2.7 per cent growth in FY16.
In contrast, credit to services sector jumped to 19.5 per cent by the end of March 2017, from 9.1 per cent in March 2016, according to the Reserve Bank of India (RBI).
The pace of growth in personal loans segment, covering areas like housing credit, consumer durables, and credit cards outstanding moderated to 16.7 per cent in March 2017 from 19.4 per cent in March 2016. The credit card outstanding grew by 34 per cent in March 2017, a big jump from 23.7 per cent a year ago.
Credit to agriculture and allied activities increased by 12.4 per cent in March 2017, lower than the increase of 15.3 per cent in March 2016.
Gross bank credit rose by 7.4 per cent in March 2017, down from 9 per cent in March 2016.
In credit to industry, loans to sub-sectors such as infrastructure, food processing, basic metal and metal products, and textiles decelerated/contracted. However, credit growth to petroleum, coal products, nuclear fuels, vehicles, vehicle parts, transport equipment, and construction accelerated, RBI said.