India is going through its strongest stretch of credit expansion since 2012, according to a report from a foreign brokerage. The momentum appears to be led by solid demand from companies, with corporate borrowing emerging as the main driver of overall loan growth.
The report said corporate loan growth climbed to its highest level in 13 years in May, pointing to a broad pickup in business financing needs. That trend suggests companies are borrowing more for expansion, operations and investment, helping push up system-wide credit growth.
Household lending has also stayed firm, with loan growth in this segment remaining resilient for four straight months. Steady demand from retail borrowers indicates that consumer-side credit appetite has held up even as the corporate segment takes the lead.
Non-banking financial companies also added to the trend, as retail loan growth in the sector accelerated. Taken together, stronger corporate demand, stable household borrowing and faster NBFC retail lending signal a broad-based rise in credit activity across India’s financial system.
