Archive · 7 Aug 2025
RBI Survey: Loan Demand Moderates, Recovery Expected
Banks are seeing a slowdown in how much people and companies want to borrow money right now.
However, the banks think things will get better soon.
Demand for loans in farming, building things, and personal loans went down in the first few months, but banks believe more people will want loans for these things and for manufacturing in the coming months.
Banks are also making it easier to get loans, so it should be easier to borrow money.
Loan demand moderated in Q1 FY26 across major sectors.
Bankers anticipate a recovery in loan demand from Q2 FY26 onward.
Agriculture, infrastructure, and retail/personal loans experienced a decline in demand in Q1.
Manufacturing, retail/personal loans, and agriculture are expected to see gains in Q2.
Credit terms largely remained accommodative in Q1, with further easing expected.
- Who
- Major scheduled commercial banks.
- What
- Loan demand moderated in Q1 FY26, with a projected recovery from Q2 FY26.
- When
- Q1 FY26, with expectations for Q2-Q4 FY26.
- Where
- India.
- Why
- Bankers expect a recovery due to seasonal factors.
- Survey Conducted by
- RBI
- Survey Participants
- 30 major scheduled commercial banks
- Survey Coverage
- Over 90% of total bank credit in India
- Q1 Overall Loan Demand Net Response
- 37.5%
- Q2 Overall Loan Demand Net Response (Expected)
- 41.1%
- Q4 Overall Loan Demand Net Response (Expected)
- 48.1%
- Net Response for lending conditions (Q1)
- 12.5%
Sources
Bank credit down because corporates using bond market to raise funds: RBI
Bank credit growth rate slowing, but overall flow of financial resources to commercial sector rising: RBI
UPI has a cost, someone must bear it, RBI Guv says in post MPC presser
No cause of concern on unsecured lending, MFI asset quality: Malhotra
