NEW DELHI: Credit growth to the Ministry of Micro, Small & Medium Enterprises (MSME) sector has expanded by Rs 52,800 crore in the current financial 2022-23 year against degrowth of Rs 61,000 crore during the similar period of the previous year, SBI Research said in its weekly report 'Ecowrap'.
Overall credit growth has gained further traction over the previous fiscal and has recorded a three-year high growth of 14 per cent as of mid-July.
The sector-wise credit data for the month of June 2022 indicates that there is a substantial improvement in incremental credit to each and every sector.
Further, the aggregate deposits grew by 8.4 per cent for the fortnight ended July 16, 2022, compared to last year's growth of 10.7 per cent. During the fortnight, there was a decline in deposits by Rs 1.51 lakh crore and Rs 1.0 lakh crore in credit.
"The decline in deposits is due to the trend in every alternative fortnight, which may be due to salary withdrawals in the first fortnight of every month for recurring consumption purposes," it said.
Going forward, the banking sector outlook depends upon the evolving geopolitical situation and its impact on global commodity prices and logistics.
"In FY23, we expect both deposits and credit will continue to grow in double digits, despite the interest rate reversal," the SBI Research added.