Bank credit growth accelerated sharply in July 2026, with non-food bank credit rising 19.1% year-on-year as of the fortnight ended July 31, according to the latest Reserve Bank of India data. This growth was nearly twice the 9.9% recorded during the corresponding fortnight of the previous year, pointing to a broad-based increase in bank lending across key segments of the economy. The RBI's sectoral deployment of bank credit data, collected from 41 select scheduled commercial banks accounting for about 95% of total non-food credit, showed strong credit growth across agriculture, industry, services and personal loans.
Gold loans continued their exceptional performance, accounting for more than a third of incremental bank credit to the retail segment during the first four months of FY27 (April-July 2026), according to the latest RBI data. The standout performer was the loans against gold jewellery category, which drew an incremental credit of ₹90,888 crore and made up 13.6% of all new non-food credit in the banking system. This exceptional growth rate reflects banks taking time to adjust to new regulatory frameworks implemented by the central bank, with the RBI noting that gold loans maintained exceptionally strong expansion despite some moderation in other lending segments.
The broader personal loan segment demonstrated robust performance, with banks' personal loan segment as a whole growing 16.2% year-on-year, compared with the 11.9% rate seen a year prior. The personal loans segment recorded a year-on-year growth of 16.2%, capturing a total incremental credit of over ₹2.4 lakh crore. Vehicle loans also sustained strong double-digit growth, adding ₹25,877 crore during the period. Credit card outstanding and loans against gold jewellery recorded slower growth during the period, indicating mixed performance across different personal lending categories.
Credit to industry emerged as a key driver, recording 20% year-on-year growth in July, sharply higher than the 6.5% growth recorded during the corresponding period last year. The RBI data shows credit growth was supported by an acceleration in lending to large and medium industries, while credit to micro and small industries remained steady. Within the industrial sector, credit growth was buoyant in infrastructure, basic metal and metal products, all engineering, chemical and chemical products, petroleum, coal products and nuclear fuels, and textiles. The growth was supported by faster expansion in lending to non-banking financial companies (NBFCs), trade and commercial real estate.
According to the latest RBI data, overall retail credit commanded the lion's share, accounting for 36% of all incremental bank credit, closely followed by credit to industry at 33%, services at 20%, and agriculture at 9.3%. The services sector maintained its strong momentum, registering 22.9% year-on-year growth compared with 10.2% a year earlier, supported by segments such as non-banking financial companies (NBFCs), trade and commercial real estate. The banking sector as a whole is witnessing robust momentum, with the RBI data following a sharp acceleration in industrial credit during June, with outstanding credit to industry standing at ₹47.72 lakh crore as of June 30, 2026, registering 19.2% year-on-year growth compared with 6.3% a year earlier.
