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Notwithstanding concerns about credit growing faster than deposits, bankers remain upbeat on loan demand across major sectors for the subsequent quarters of the financial year 2024-25, according to the Reserve Bank of India’s quarterly Bank Lending Survey.
Easy loan terms and conditions are expected to continue in the second half of 2023-24, except for the mining sector; loans in the infrastructure sector are perceived to have relatively less softer terms. according to the survey.
The latest round of the survey, conducted during Q1 2024-25, collected senior loan officers’ assessment of credit parameters for Q1 2024-25 and their expectations for Q2, Q3, and Q4 of 2024-25. It captures the qualitative assessment and expectations of major scheduled commercial banks regarding credit parameters (loan demand as well as terms and conditions of loans) for major economic sectors.
However, bankers’ growth assessment of loan demand recorded a seasonal moderation across major sectors during Q1 2024-25. Respondents reported the continuation of easy loan terms and conditions for major sectors, except mining; relative prudence was also observed in retail/personal loans and agricultural credit.
For the second quarter, bankers remained optimistic on loan demand across major sectors barring mining and quarrying. Overall, easy loan terms and conditions are expected to prevail during the quarter; however, lower optimism is reported for retail/personal loans.
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