Bank credit grew 17.44 per cent year-on-year in May, marking the ninth consecutive month of double-digit expansion, reflecting sustained demand for loans from both retail and corporate borrowers, according to the latest Reserve Bank data. On May 15, credit growth was seen at 16.06 per cent, indicating a sharp pickup by month-end.
Since January 31 this year, credit growth has stayed above 13 per cent and ranged between 14 and 17 per cent thereafter. The uptrend became more pronounced from September 2025 onward, when growth accelerated to 10.21 per cent and 10.29 per cent in successive fortnights, and remained firmly in double-digit territory thereafter.
On September 3 last year, the GST Council approved a simplified two-tier tax structure of 5 per cent and 18 per cent, a move seen as improving compliance clarity and business sentiment.
October and November consolidated the recovery, with lending growth moving past 11 per cent and hovering in the 11-11.4 per cent range, supported by festive demand, retail loan expansion and higher trade financing.
This momentum strengthened further in December, with growth climbing from 11.63 per cent and 11.87 per cent in mid-month readings to 14.39 per cent by December 31, driven by stronger year-end corporate drawdowns and balance sheet expansion.
The trend continued into January and February 2026, with credit growth rising to between 13 per cent and 14.41 per cent.
Also read: Crisil pegs FY26 bank credit growth at 12 pc
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