Sharp spike in loans to NBFCs, renewable energy, aviation cos in January

Mumbai: Non-food credit growth of banks slowed to 5.7% in January led by a decline in industrial and personal loans. Credit growth in this category was 8.5% in January and 5.9% in December.

Loans to aviation and non-banking finance companies saw a sudden spike in January, even as services sector credit growth continued to slow, reaching 8.4% year-on-year in January 2021, after having risen to 9.5% in October 2020 and 8.8% in December.

Within services, aviation sector saw 120% jump in credit growth to ₹12,280 crore at the end of January 2021 compared to a 60% contraction last year. Similarly loans to NBFCs, like Power Finance Corporation, and Rural Electrification Corporation, saw a 151% growth to ₹71,109 crore during the same period.