Credit surges 17.7% as deposit slowdown widens funding gap

Credit growth stood at 17.7% for the fortnight ending May 31, 2026, the highest recorded so far in the current financial year and the strongest year-on-year expansion since June 2024. Outstanding bank credit rose by Rs 1.5 lakh crore since March 31, 2026, marking a 0.7% increase (year-to-date), with total credit touching Rs 215.2 lakh crore. Bankers said demand is being driven partly by oil marketing companies facing lower realisations after the surge in crude prices. They added that govt support through the emergency credit line guarantee scheme has also lifted credit offtake.

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