New Delhi, May 5 (KNN) India’s non-food credit grew 15.9 per cent year-on-year (YoY) in FY2025–26, indicating strong lending momentum.
According to data released by the Finance Ministry on Tuesday, total outstanding bank credit stood at Rs 212.9 lakh crore as of March 2026, an increase of Rs 29.2 lakh crore over the previous year.
The growth comes amid a low interest rate environment and sustained government-led capital expenditure, which has helped crowd in private investments and boost confidence among both corporate and retail borrowers.
Broad-Based Growth Across Key Sectors
The data highlighted that credit expansion during the year was broad-based, with all major sectors recording stronger growth.
Lending to the services sector, which accounts for around 28 per cent of total credit, rose by 19 per cent compared with 12 per cent a year earlier, driven mainly by NBFCs, trade and commercial real estate.
The retail segment, contributing about 33 per cent of overall credit, grew by 16.2 per cent versus 11.7 per cent last year, with steady housing loan demand and strong traction in vehicle and gold-backed loans.
Credit to agriculture and allied activities accelerated to 15.7 per cent, supported by sustained rural demand and greater formalisation of farm credit.
Meanwhile, lending to industry nearly doubled to 15 per cent from 8.2 per cent in FY25, led by micro and small enterprises with a sharp 33.1 per cent rise, while medium industries grew by 21.7 per cent, with infrastructure, metals, chemicals and energy sectors as key contributors.
Positive Outlook for Investment and Employment
Sustained credit growth is expected to support business expansion, infrastructure development, and consumption demand. Increased borrowing by companies and households is likely to drive capacity creation, boost industrial activity, and generate employment opportunities.
(KNN Bureau)
