Bank Credit Growth Plummets to Single-Digits in May 2025
In May 2025, bank credit growth drastically fell to 9.8%, compared to last year's robust 19.5%, as per an SBI report. The report underscores a significant slowdown across key economic sectors. Deposits also witnessed reduced growth, and credit demand softened in agriculture, industry, and services sectors.
- Country:
- India
In a significant downturn, bank credit growth plunged to a mere 9.8% in May 2025, a sharp decline from the robust 19.5% recorded just a year earlier, according to a report from the State Bank of India (SBI). The report highlights a broad-based deceleration in lending activities across major economic sectors.
The SBI noted that scheduled commercial banks saw their credit growth slow substantially to 9.8% as of May 16, 2025, against last year's impressive rise. Banking data showed that during April-May, credit contracted by Rs 15,676 crore, marking a negative year-to-date growth of 0.1%, contrasting starkly with the Rs 1.68 lakh crore growth (1.0% YTD) the previous year.
While deposit growth remained positive, it was also sluggish compared to the prior year, increasing by Rs 3.06 lakh crore (1.4% YTD) versus last year's Rs 3.39 lakh crore (1.7% YTD). The report further detailed sector-wise credit trends for April 2025, revealing a slowdown in agriculture, industrial, and services sectors, though certain industrial areas experienced a rise in credit.
(With inputs from agencies.)
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