Banks Going Slow on Retail Loans- RBI

April 21, 2009	(Be the first to rate this story!)  Loading ...
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Banks are increasingly turning risk-averse in growing their retail portfolios, according to the Reserve Bank of India (RBI). The macro economic survey, released by RBI on Monday, said retail loans, which accounted for 10.7 per cent of the incremental non-food credit, witnessed moderation mostly because private and foreign banks curtailed retail credit growth. Of the retail loans, credit cards and home loans have been the worst hit. Total home loan disbursement was only Rs 19,012 crore during the year up to February 27, 2009, down from Rs 26,930 crore disbursed a year ago. The disbursal under credit cards also fell sharply to Rs 2,332 crore in the same period from Rs 8,947 crore from the year-ago period. Consumer durable loans portfolio shrunk by Rs 1,393 crore during the period. In the same period last year, about Rs 525 crore of additional loans were disbursed as consumer loans by banks compared with the year before.

Education loans were also not spared by the downturn with the portfolio growing only by 33.8 per cent as against 40.9 per cent reported last year. Total education loans disbursed during the period was Rs 7,030 crore as against Rs 5,938 crore disbursed in the year-ago period. While the services sector grew by 19.2 per cent up until February 27, 2009, it was growing at 28.4 per cent the same period last year. Real estate loans surprising grew by a whopping 61.4 per cent with total disbursal to the sector touching Rs 34,533 crore — a sharp rise from 11,361 crore disbursed the same time last year.

News Published Under:   Real Estate India, Banking and Finance |

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