Loans to the private sector increased by 12 percent year-on-year (YoY) to Rs. 9.6 trillion in FY25, slightly above the 10-year average growth rate of 11 percent.
According to central bank data, there is still potential, as it stands at just 8.4 percent of GDP in FY25, well below the 15.2 percent of GDP recorded in FY18.
Auto financing (part of loans to the private sector) also saw a strong rebound, rising by 20 percent YoY in FY25.
With the sharp decline in interest rates and a pickup in economic activity, a report by Topline Securities expects double-digit loan growth to continue in FY26.