Indian banks experienced a significant surge in credit to industries, with a 17.5% annual growth in May, driven by lending to large corporations and the MSE sector.
New Delhi, India Jul 1, 2026 ALN: Mumbai: Bank credit to industry recorded a robust annual growth of 17.5 percent in May, as advances to large industries grew at an accelerated pace, along with sustained healthy expansion in the Micro and Small Enterprises (MSE) sector, according to data released by the Reserve Bank of India (RBI).
On a year-on-year (y-o-y) basis, non-food bank credit grew by 17.4 percent as of the fortnight ended May 31, 2026, compared to 8.8 percent during the corresponding period of the previous year (May 30, 2025). This data reflects a significant uptick in lending activities across various sectors.
Additionally, credit to agriculture and allied activities registered a y-o-y growth of 14.9 percent compared to 7.5 percent in the same fortnight of the previous year. The RBI noted that credit to industry recorded a robust y-o-y growth of 17.5 percent (up from 5.3 percent in the corresponding fortnight of last year).
While credit to micro and small industries sustained robust expansion, large industries grew at an accelerated pace, indicating a positive trend in industrial financing.
Among major industries, credit to infrastructure, engineering, textile, construction, petroleum, coal products, and chemical products marked buoyant growth. However, segments such as rubber, plastic, and their products, as well as wood and wood products, witnessed marginally subdued growth.
Furthermore, credit to the personal loans segment recorded a growth of 15.4 percent compared to 11.1 percent a year ago. Segments such as vehicle loans and housing registered steady growth, while credit card outstanding decelerated.
The services sector also showed impressive growth, with a loan growth rate of 20.4 percent (up from 8.4 percent in the corresponding fortnight of the previous year). This growth was supported by accelerated lending in segments such as non-banking financial companies, commercial real estate, and trade.
The data on sectoral deployment of bank credit has been collected from 41 select scheduled commercial banks, which together account for about 95 percent of the total non-food credit by all scheduled commercial banks, according to the RBI.
In conclusion, the robust growth in bank credit to industry reflects a vibrant landscape, driven by strong lending to both large corporations and the MSE sector. This trend is expected to support continued expansion in the coming months.
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