Retail lending is now the central pillar of India’s bank credit growth, with 52% of bankers expecting >13% YoY expansion and none forecasting below 9%, according to the FICCI-IBA Bankers’ Survey. The survey — covering 24 banks — projects overall non-food credit growth in the 11–13% range for H1 2026. SME, services, and retail lending are robust; industrial growth remains measured (9–13%). Term loans will be driven by infrastructure, real estate, autos, pharma, data centres, and defence. Cybersecurity is the top concern (71%), while AI (48%) and renewable energy financing (83%) lead strategic priorities.
According to www.livemint.com, retail lending is emerging as the principal driver of bank credit expansion in India, with 52% of surveyed bankers expecting year-on-year growth above 13% and none forecasting growth below 9%, per the FICCI-IBA Bankers’ Survey released on 19 April 2026.
Survey Scope and Macroeconomic Context
The survey gathered responses from 24 banks, including public, private, foreign, small finance, and cooperative institutions. It projects overall non-food credit growth for the first half of 2026 in the 11–13% range, with 46% of respondents anticipating growth in that band and 29% expecting expansion above 13%. Only 8% foresee growth below 9%, signaling limited downside risk despite global uncertainties. The outlook is underpinned by improving asset quality, stronger capital buffers, and resilient economic activity.
Sectoral Credit Demand Patterns
Credit demand across sectors reveals distinct dynamics:
- SME lending is expected to show strong double-digit growth, supported by improving business activity, formalization trends, and ongoing policy support;
- Services and retail segments are anticipated to anchor overall growth, with services lending likely remaining firmly in double-digit territory — driven by real estate, financial services, logistics, and tourism;
- Industrial credit growth is projected at a more measured pace, largely in the 9–13% range, reflecting gradual recovery led by infrastructure spending and early signs of private capital expenditure revival.
Term Loans and Working Capital Drivers
Within industry, term loan demand is expected to be led by infrastructure, real estate, automobiles, pharmaceuticals, and emerging areas such as data centres and defence. Working capital demand will be concentrated in textiles, automobiles, pharmaceuticals, engineering goods, and food processing — sectors closely tied to trade cycles and operational needs. In services, strong credit demand is anticipated from commercial real estate, NBFCs, and tourism-linked segments.
Digital Transformation and Strategic Priorities
Artificial Intelligence (AI) is identified as the top disruptive force, with 48% of respondents believing it will dramatically transform credit underwriting, risk assessment, and collections. Competition and partnerships with fintech and Big Tech rank second, followed by digital public infrastructure — including UPI, account aggregator, and CBDC. Strategically, climate risk management and financial inclusion are the top two priorities for 2026. Renewable energy financing stands out as the highest-growth sustainable product, selected by 83% of bankers.
Risk Landscape
Cybersecurity is cited as the single biggest risk by 71% of respondents, far surpassing operational or credit risk concerns. The survey also indicates broad expectations of a status quo in policy rates over the next six months, suggesting lenders view the current monetary stance as appropriately calibrated.
Source: www.livemint.com
Compiled from international media by the SCI.AI editorial team.
