Industrial Credit Jumps 19.2% in June, Signalling Investment Revival

India's industrial credit growth accelerated sharply in June 2026, reflecting a broad-based pickup in lending to businesses and reinforcing signs of stronger investment and manufacturing activity across the economy, according to the latest Reserve Bank of India (RBI) data.

Bank credit to industry expanded 19.2% year-on-year as of the fortnight ended June 30, 2026, a sharp jump from 6.3% in the corresponding period last year. The data, based on 41 scheduled commercial banks accounting for nearly 95% of total non-food credit, showed that lending growth was broad-based across micro and small enterprises (MSMEs), medium-sized firms, and large industries.

Overall, non-food bank credit rose 18.3%, nearly doubling from 9.3% a year earlier, while lending to agriculture and allied activities increased 16.8%, compared with 6.8% in June 2025. Among industrial segments, infrastructure, engineering, food processing, textiles, construction, basic metals and metal products, petroleum, coal products and nuclear fuels, and chemicals registered robust credit growth. Only rubber and plastic products and wood and wood products recorded relatively subdued expansion.

The strong momentum in industrial lending suggests that businesses are increasingly borrowing to expand capacity, invest in new projects and finance working capital requirements. Broad-based credit growth across MSMEs and large corporates also indicates improving business confidence, supported by sustained demand and ongoing infrastructure development.

The services sector remained the fastest-growing segment, with credit rising 21.4% year-on-year against 8.8% a year earlier. The increase was driven by stronger lending to non-banking financial companies (NBFCs), commercial real estate and trade, highlighting continued momentum in economic activity beyond manufacturing.

Meanwhile, personal loans grew 15.8%, up from 11.7% a year ago. Housing and vehicle loans continued to record healthy double-digit growth, although the pace of expansion in credit card outstanding moderated. The latest RBI data points to a broad-based recovery in credit demand, with accelerating industrial lending serving as a key indicator of rising capital expenditure, expanding manufacturing activity and strengthening private sector investment. If sustained, the trend could provide further support to India's economic growth and industrial output in the coming quarters.