Bank credit growth slowed to 10.2% year-on-year in June 2025

Current Context: As per RBI data released on August 1, 2025, India’s non-food bank credit growth slowed to 10.2% year-on-year for the fortnight ending June 27, 2025, down from 13.8% in the same period last year.

Sector-wise slowdown:

• Agriculture & Allied Activities: Dropped to 6.8% from 17.4%
• Industry: Slowed to 5.5%, though MSMEs and sectors like engineering & textiles showed resilience
• Services: Moderated to 9.6%, mainly due to reduced lending to NBFCs
• Personal Loans: Grew by 14.7%, down from 16.6%, with weaker demand for vehicle loans and credit cards.

Question:

Q.1 What was the year-on-year growth in India’s non-food bank credit for the fortnight ending June 27, 2025, as per RBI data?
a) 13.8%
b) 10.2%
c) 11.5%
d) 9.7%

Answer: b) Non-food bank credit growth slowed to 10.2%, compared to 13.8% during the same period in 2024. This indicates tighter credit conditions or weaker demand across key sectors.