NBFC Credit Growth Accelerates to 14.2% in May 2026
Credit extended by non-banking financial companies (NBFCs) grew 14.2% year-on-year in May 2026, up from 11.4% a year earlier, according to a Reserve Bank of India (RBI) statement. Retail loans and agriculture lending were the primary drivers, even as credit to industry and services moderated.
Agriculture and Retail Loans Lead the Surge
Agriculture and allied activities recorded the sharpest growth, rising 17.9% year-on-year in May 2026, compared to just 5.0% in May 2025. The RBI release stated, "Credit growth in agriculture and allied activities recorded a robust growth of 17.9% (y-o-y) in May 2026 against 5.0% a year ago." Meanwhile, retail loans expanded 19.5% year-on-year, up from 14.9% in May 2025, and contributed the most to overall NBFC credit growth. The RBI noted, "Retail loans contributed the most in overall credit growth by NBFCs with 19.5% (y-o-y) growth in May 2026." Within retail, housing loans, vehicle loans, and loans against gold jewellery saw robust expansion, indicating sustained consumer demand.
Industry and Services Credit Moderates
In contrast, credit growth to industry slowed to 7.3% in May 2026 from 10% a year ago, primarily due to weaker lending to infrastructure, which holds a significant share of industrial credit. Credit to the services sector also moderated, growing 16.7% year-on-year compared to 23.9% in May 2025. Despite the overall slowdown, commercial real estate lending remained buoyant. The RBI release highlighted, "Credit growth in services sector moderated to 16.7% (y-o-y) in May 2026 against 23.9% a year ago. Among major contributors, growth (y-o-y) in credit to 'Commercial Real Estate' marked buoyant expansion."
