July 30, 2009

Lack of confidence in borrowers and the lingering uncertainty has pulled down the bank credit growth by Rs 21,185.46 crore for the fortnight ended July 17. This happened at a time when credit offtake was to pick up with the onset of a busy season, according to the latest quarterly data compiled by the Reserve Bank of India.

“Industry is not yet confident about the revival. Dip in credit growth will continue for a while, as companies, especially in the infrastructure sector, will ensure that once they start spending, the projects do not get delayed. Banks are sitting on large sanctions with no disbursements,” said a senior Bank of India official.