Credit offtake up 21.3% in 12 months to Oct

Credit offtake up 21.3% in 12 months to Oct

Mumbai: Indicating a sound industrial activity in the country, credit offtake from banks grew by 21.3% during the one-year period ended 22 October, up from 9.3% in the same period a year ago.

As of 22 October, credit offtake from banks stood at Rs35.81 lakh crore. As of 23 October 2009, bank credit for the 12 month period was Rs29.51 lakh crore, the Reserve Bank of India (RBI) said on Wednesday.

During the September 2009-10 period, the Indian economy had embarked on the recovery path from the global financial meltdown that began in September 2008.

Meanwhile, in its annual monetary policy the RBI has estimated that credit would grow by 20% this fiscal.

“The growth in non-food credit of banks is placed at 20%. As always, these numbers are provided as indicative projections and not as targets," the RBI had said.

During the past few months, the rate of growth in credit offtake has hovered just below 20%.

But credit growth during the one-year period ended 13 August had jumped by to 20.2% to Rs34.64 lakh crore. After a gap of a month, the growth has once more surpassed the 20% mark.

Credit growth has been higher so far this fiscal on account of large borrowings by telecom firms for the 3G spectrum (radio waves).

The government earned over Rs1 lakh crore from the sale of spectrum for high speed mobile and broadband wireless services, far higher than the estimated revenue of Rs35,000 crore in the budget.

According to analysts, the demand for credit is good and the country can expect robust growth in the current fiscal.

Ratings agencies like Crisil had earlier said that the country is likely to see credit growth of around 20-22% this fiscal.