ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

A+| A| A-

Is the Growth in Bank Credit a Serious Concern?

Despite the series of policy rate hikes and the corresponding hike in lending rates, the demand for bank credit seems to be robust. The banking system should be allowed to meet this demand in a non-disruptive way without fuelling inflationary pressures. Higher interest rates do not seem to be a deterrent to credit growth since the demand for credit is fuelled by economic activity and banks find their own way of handling additional risks. It would therefore be prudent for the Reserve Bank of India to continue with its anti-inflationary stance and the tightening of monetary policy. However, the pattern of credit growth suggests the need for redistribution in favour of agriculture and exports.


Dear Reader,

To continue reading, become a subscriber.

Explore our attractive subscription offers.

Click here


To gain instant access to this article (download).

INR 59

(Readers in India)

$ 6

(Readers outside India)

Support Us

Your Support will ensure EPW’s financial viability and sustainability.

The EPW produces independent and public-spirited scholarship and analyses of contemporary affairs every week. EPW is one of the few publications that keep alive the spirit of intellectual inquiry in the Indian media.

Often described as a publication with a “social conscience,” EPW has never shied away from taking strong editorial positions. Our publication is free from political pressure, or commercial interests. Our editorial independence is our pride.

We rely on your support to continue the endeavour of highlighting the challenges faced by the disadvantaged, writings from the margins, and scholarship on the most pertinent issues that concern contemporary Indian society.

Every contribution is valuable for our future.