TIL Desk/Business/New Delhi/ In a meeting between the chiefs of public sector banks (PSB) and the Reserve Bank of India (RBI) officials, the RBI pointed out the muted credit growth in the economy and asked them to take steps to increase credit growth.
“The moot point was why the credit growth is still muted and there was exchange of views between the bankers and the governor.”Since, the private sector banks are seeing credit growth the public sector will also have to make sure that credit growth picks up”, said a senior banker with a public sector bank.
Another public sector bank executive who was part of the meeting said, state owned banks informed the RBI that after the asset quality review, their staff has been spending considerable time on recoveries and resolutions and there was less emphasis on sales and business development across regions.
But now the situation is changing and banks have put more teams on street (pushing loans and financial products). Bank credit growth declined to 8.5 per cent in January from 13.5 per cent in the year-ago period led by a sharp slowdown in loans to the services sector, according to RBI data.
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