According to the data released by RBI, bank credit outstanding on the last Friday of September was Rupees 109.5 lakh crore. Of this, the share of loans to industry dropped to 26% (Rupees 28.3 lakh crore) from 27% recorded last year. Personal loans, which were 25% of all bank loans in September 2020, increased to 27% (Rupees 29.2 lakh crore) by the end of September 2021. The data shows how exploitative a banking system is when a personal loan is bigger than industrial loans in the country.
The drop in bank credit to the industry segment was largely due to companies in core industries deleveraging.
For the first time, the share of personal loans in bank credits has overtaken overall loans to the industry sector during the second quarter of the current FY21. This has happened with loans to the industry as of the end of September 2021 shrinking by Rupees 66, 239 crores over March 2021 levels, while loans to individuals grew Rupees 73,011 crore during the period.
In the agriculture sector, loan share is a constant of 12%. In the Industrial sector loan share declined to 26% in Sept 2021 from 27% in Sept 2020. In-Service Sector loan share declined to 23% in Sept 2021 from 24% in Sept 2020. Personal loan share rose to 27% in Sept 2021 from 25% in Sept 2020. Priority sector is a constant rate of 12%.
Source: The Times Group