Credit extended by non-banking financial companies (NBFCs) grew 14.2 per cent year-on-year in May 2026, up from 11.4 per cent a year earlier, with retail loans remaining the biggest driver of overall credit growth, according to data released by the Reserve Bank of India (RBI).
The RBI said NBFC lending maintained healthy momentum during the month, supported by strong growth in retail and agriculture credit, even as lending to the industry and services sectors moderated.
Credit to agriculture and allied activities recorded the fastest growth among major sectors, rising 17.9 per cent year-on-year in May, compared with 5 per cent in the corresponding period last year.
“Credit growth in agriculture and allied activities recorded a robust growth of 17.9 per cent (y-o-y) in May 2026 against 5.0 per cent a year ago,” the RBI said.
Retail loans continued to be the largest contributor to overall NBFC credit growth, expanding 19.5 per cent year-on-year, compared with 14.9 per cent in May 2025.
Within the retail segment, housing loans, vehicle loans and loans against gold jewellery registered robust growth, reflecting sustained consumer demand across key borrowing categories.
In contrast, credit growth to the industrial sector moderated to 7.3 per cent in May 2026 from 10 per cent a year earlier, mainly due to slower lending to the infrastructure sector, which accounts for a significant share of industrial credit.
Credit to the services sector also eased, growing 16.7 per cent year-on-year, compared with 23.9 per cent in May 2025.
However, lending to the commercial real estate segment remained buoyant, making it one of the key contributors to credit growth within the services sector.
“Credit growth in services sector moderated to 16.7 per cent (y-o-y) in May 2026 against 23.9 per cent a year ago. Among major contributors, growth in credit to commercial real estate marked buoyant expansion,” the RBI said.
-ANI
