Retail Focus Boosts Share Of Personal Loans: RBI

Mumbai: The Reserve Bank of India on Tuesday said the focus by lenders on the retail segment has helped increase the share of personal loans in the system to 19.3 per cent in June 2016, from 17.9 per cent in March.

"Retail focus of banking sector helped the share of personal loans in total credit of scheduled commercial banks to increase to 19.3 per cent in June 2016 from 17.9 per cent in March 2016," the RBI said in a statement.

Citing data, the regulator said the home loan segment was one of the prime contributors to this uptick.

The data release, part of the quarterly BSR-1 which gives details on the outstanding credit of scheduled commercial banks on a variety of factors, comes amid a move away from the high value corporate segment by lenders.

The lenders blame both a lack of demand from corporates and concerns over credit quality for their focus on the retail segment, which has displayed resilience till now.

The RBI said credit to industry grew at a slower pace of 5.2 per cent and its share in total credit in the system increased to 41.6 per cent from 40.4 per cent.

The RBI said the Weighted Average Lending Rate (WALR) came down to 11.28 per cent in June 2016 from 11.34 per cent in March 2016 and added that it dropped by 0.41 per cent as compared to June 2015.

The reduction is seen mainly in loans and advances categorised as professional other services (0.64 per cent), industry (0.52 per cent), housing (0.51 per cent) and personal loans (0.37 per cent).

Credit growth at private lenders which are better off from the asset quality troubles was higher while rural and semi-urban areas continued to grow at a faster pace than urban and metropolitan regions, it said.

The data cover performance by 91 banks from over 1.09 lakh outlets.