Bank Credit Growth Hits 19.1% in July, Nearly Doubling Year-on-Year

MUMBAI – In a significant indicator of robust economic activity, non-food bank credit in India witnessed a broad-based surge, climbing to 19.1% in the fortnight ending July 31, 2026. According to the latest data released by the Reserve Bank of India (RBI), this growth figure represents a near-doubling of the 9.9% growth rate recorded during the same period last year.

The latest findings, derived from data provided by 41 select scheduled commercial banks—which collectively represent approximately 95% of the total non-food credit extended in the country—point toward a healthy appetite for capital across all major economic pillars.

Services and Industry Lead the Surge

The most aggressive expansion was observed in the services sector, which recorded a stellar growth rate of 22.9%, more than doubling the 10.2% growth seen in the previous year. The RBI attributed this jump primarily to increased credit demand from non-banking financial companies (NBFCs), the trade sector, and commercial real estate.

The industrial sector also staged a remarkable recovery, with credit growth accelerating to 20% compared to a sluggish 6.5% a year prior. Large and medium-scale industries were the primary drivers of this industrial credit expansion. Significant momentum was noted in key sub-sectors, including infrastructure, chemicals, textiles, petroleum, and basic metal production. While credit to micro and small industries remained steady, the overall surge in large-scale industrial funding indicates strong corporate expansion plans.

Agricultural and Personal Lending

The agrarian economy also saw heightened financial support, with credit to agriculture and allied activities jumping to 17% from 7.3% last year.

In the retail space, personal loans continued their upward trajectory, growing by 16.2%. The demand for housing and vehicle loans remained particularly strong, continuing to post double-digit growth. However, the data highlights a shift in consumer behavior, with some moderation observed in credit card outstandings and loans against gold jewellery, suggesting that while retail borrowing remains high, consumers are becoming more selective in certain high-interest categories.

A Broad-Based Economic Recovery

The bank credit growth observed in July is notable for being evenly distributed rather than being siloed in a single sector. With industry, services, and agriculture all firing on all cylinders, the figures offer a promising outlook for overall economic momentum.

As banks continue to see high demand for liquidity across sectors, the 19.1% growth rate serves as a key benchmark for the health of India’s financial system and its broader economic expansion heading into the latter half of the year.