Bank lending to industry and services rose sharply in September 2026, RBI data showed. Overall credit grew by 19.1% year on year, up from 11.2% last year. Bankers said the demand for credit is broad-based. Many sectors like infrastructure and trade got more loans as the festive season started recently.
Reflecting buoyancy in the economy at cusp of busy season and festivities, the pace of bank lending to industry and services sector rose sharply in September 2026 over a year ago period. The overall credit grew by 19.1% year on year at the end of September 2026, up from 11.2% a year ago, Reserve Bank of India data showed.
The bank loans to agriculture and allied activities also saw strong uptick while the retail lending showed steady rise.
Credit to industry recorded a y-o-y growth of 19.5 % by the end of September 2026, a sharp jump from 7.7 per cent in the corresponding fortnight of last year. Bankers said the demand for credit is broad-based. The substantial part of credit has been deployed for working capital demand, reflecting effect rise in costs due to west Asia conflict.
RBI in a statement said while credit to 'large' and 'medium' industries grew at an accelerated pace, 'micro and small' industries exhibited steady growth. Among major industries, credit to 'infrastructure', 'basic metal and metal products', 'all engineering', 'chemical and chemical products', 'food processing' and 'textiles' marked buoyant y-o-y growth. With steady economic growth in the busy season - October - March period, the drawdown from pipeline of sanctioned credit is expected to be robust in Q3 and Q4, said a senior public sector banker.
Credit to services sector registered a y-o-y growth of 28.3% as against 9.9% a year ago, supported by buoyant growth in segments such as 'non-banking financial companies' (NBFCs), 'trade', 'commercial real estate', 'transport operators' and 'professional services', RBI said. The growth in loans to housing finance companies moved from negative territory (-0.5%) to positive (19.7%). The commercial real estate grew by 23.3 % till end of September up from 15.6% same period last year.
The retail Credit segment recorded a y-o-y growth of 17.3 per cent, as compared with 11.5 per cent a year ago. While credit growth in segments such as 'housing' and 'vehicle loans' remained resilient, 'advances against fixed deposits' accelerated. Growth in 'loans against gold jewellery' and 'education' decelerated compared to last year.
Credit to agriculture and allied activities registered a y-o-y growth of 19.5% vis-a-vis 8.9% cent in the previous year.