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Non-Food bank credit growth slowed down to 5.9% in May Suggest RBI data

The non-food bank credit growth slowed to 5.9 per cent in May 2021, as compared to 6.1 per cent in the year-ago month, suggested RBI data. Credit to agriculture and allied activities continued to perform well, registering an accelerated growth of 10.3 per cent in May 2021, as compared to 5.2 per cent in May 2020 as per RBI data relived on Wednesday.

The growth in advances to industry decelerated to 0.8 per cent in May 2021, from 1.7 per cent a year ago. Size-wise, credit to medium industries registered a robust growth of 45.8 per cent in May 2021, as compared to a contraction of 5.3 per cent a year ago, as per the data that was witnessed. Credit growth to micro and small industries accelerated to 5 per cent in May 2021, as compared to a contraction of 3.4 per cent a year ago, while credit to large industries contracted by 1.7 per cent in May 2021, as compared to a growth of 2.8 per cent a year ago.

Loan growth to the services sector decelerated to 1.9 per cent in May 2021, from 10.3 per cent in May 2020, mainly due to deceleration in credit growth to Non-Banking Financial Companies (NBFCs), transport operators and commercial real estate, suggested RBI data. 

However, the credit-to-trade segment continued to perform well, registering accelerated growth of 12.4 per cent in May 2021, as compared to 7.7 per cent a year ago. 

Personal loans registered an accelerated growth of 12.4 per cent in May 2021 as compared to 10.6 per cent a year ago, primarily due to accelerated growth in vehicle loans and credit card outstanding. 

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