In July, bank loans in India saw a significant year-on-year increase of 19.8%, largely due to the merger of Housing Development Finance Corporation (HDFC) with HDFC Bank and the growth of personal loans. Non-food credit reached Rs 147.8 trillion as of July 29, reflecting a 15.1% year-on-year increase.
Personal loans surged by 31.7% year-on-year to reach Rs 47.3 trillion by the end of July, with housing loans rising by 37.4%, credit card outstanding by 31.2%, and other personal loans by almost 29%. Even advances against fixed deposits showed robust growth at 24.2%. This growth in personal loans occurs as the Reserve Bank of India (RBI) monitors the rise in unsecured personal loans. Additionally, loans to various industries and non-banking financial services companies (NBFCs) also saw significant growth, indicating a positive outlook for bank credit in India. Credit rating agency CareEdge Ratings estimates credit growth of 13.0-13.5% for the fiscal year 2023-24, excluding the merger's impact.