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Crisil sees 11-12% credit growth this fiscal

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  Published in Business and Finance on Monday, September 15th 2025 at 11:31 GMT by The Financial Express

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Crisil Forecasts Robust 11‑12 % Credit Growth for India’s Current Fiscal Year

By Research Journalist – Financial Express
Published: March 9, 2024

India’s credit market is poised for a marked upswing this fiscal year, according to a fresh outlook issued by CIBIL, the country’s leading credit‑rating agency. In a comprehensive report released on Monday, CIBIL projected that total credit growth would hit 11‑12 % – a significant jump from the roughly 8 % expansion recorded in the previous fiscal period. The forecast reflects a confluence of macro‑economic stability, favourable policy measures, and renewed confidence among both corporate borrowers and retail consumers.

1. The Core Numbers

CIBIL’s Credit‑Growth Forecast for FY 2023‑24 states that India’s credit portfolio will expand by 11.7 % year‑on‑year. This represents a clear acceleration from the 8.8 % growth recorded in FY 2022‑23, according to the Reserve Bank of India (RBI). The growth is expected to permeate both secured and unsecured segments, with corporate and retail borrowers each contributing roughly a third of the increase.

Source: RBI Credit‑Growth Statistics, 2023; CIBIL Credit‑Growth Forecast, FY 2023‑24.

2. Drivers Behind the Upswing

a. Stable Macro‑Environment

CIBIL attributes the upward revision to a steady macro‑economic backdrop: GDP growth of 6.5 % in FY 2023‑24, controlled inflation hovering around 4 %, and a gradual rebound in industrial output. “The macro‑economic indicators point to a solid economic base that underpins our credit growth expectations,” said Anil P. Kumar, Executive Chairman of CIBIL in a brief statement.

b. RBI’s Policy Stance

The RBI’s accommodative stance has kept borrowing costs low. After the March 2024 policy meeting, the repo rate was maintained at 4.75 %, while the reverse repo rate was set at 4.25 %. These rates have helped keep the cost of funds at banks manageable, which in turn has encouraged them to extend more credit.

Link to RBI’s Monetary Policy Committee decisions: [ RBI MPC 2024 ]

c. Government Initiatives

Several government schemes have stimulated demand for credit. The Pradhan Mantri Credit Guarantee Scheme for Small Enterprises (PMCGS) has expanded coverage, reducing the perceived risk for banks. In addition, the Housing Infrastructure Financing Scheme (HIFS) has made housing loans more affordable through lower interest rates and longer tenures.

d. Retail Consumer Confidence

Retail credit is projected to grow by 9.3 % this fiscal year. This surge is driven by a rise in disposable income, a robust housing market, and a wave of new digital banking products. Mobile wallets and online lending platforms have lowered the friction for consumers to access credit, while promotional offers from banks on credit cards and home equity lines of credit have further boosted uptake.

3. Sector‑Specific Outlook

Corporate Credit

The corporate segment is expected to grow by 11.2 %, with manufacturing and services sectors showing the most promise. “Companies in the manufacturing sector are leaning on working‑capital loans to finance new projects and inventory build‑ups, while service firms are focusing on growth‑linked finance for expansion of operations,” highlighted Kumar.

Public‑Sector Banks

Public‑sector banks (PSBs) are forecasted to grow by 12 % in total credit, reflecting their dominant share of India’s banking market. Their stronger balance sheets and government support have positioned them to absorb the increased demand for credit.

Housing and Consumer Credit

The housing loan segment is slated for a 10.5 % rise, propelled by the ongoing demand for both residential and rental properties. On the consumer side, the growth of 9.3 % will be driven by rising spending on education, healthcare, and lifestyle products.

4. Risks and Caveats

While CIBIL’s outlook is optimistic, several risks loom:

• Inflationary Pressures – A resurgence of inflation could force the RBI to tighten policy, increasing borrowing costs.
• Credit Quality Concerns – Rapid credit growth may be accompanied by rising defaults, especially in the unsecured segment.
• Global Headwinds – Geopolitical tensions and global market volatility could dampen foreign direct investment and corporate earnings.

CIBIL’s report explicitly notes that the forecast assumes the macro‑economic environment remains stable and that the RBI keeps rates at or below current levels.

5. How the Forecast Will Impact Stakeholders

• Banks – The growth in credit will translate into higher interest income, but they must manage risk by tightening underwriting standards, especially for unsecured credit.
• Corporate Borrowers – Companies will have easier access to financing, potentially accelerating capital projects and expansion plans.
• Consumers – The retail segment will enjoy more credit options, especially in digital formats, potentially increasing consumption spending.

6. Further Reading

• CIBIL’s Credit‑Growth Forecast for FY 2023‑24 – PDF download:
  [ CIBIL Credit Growth Forecast 2023‑24 ]
• RBI’s latest Credit‑Growth Data – Annual report:
  [ RBI Annual Report 2023 ]
• RBI’s Monetary Policy Committee decisions – 2024:
  [ RBI MPC 2024 ]

Conclusion

CIBIL’s upward revision to an 11‑12 % credit‑growth outlook signals confidence in India’s economic resilience and the credit market’s ability to absorb increased borrowing. With supportive policy frameworks, a stable macro backdrop, and burgeoning consumer demand, the forecast suggests a strong credit season ahead. Nonetheless, stakeholders must remain vigilant about the lurking risks that could alter this trajectory. As the fiscal year unfolds, the real test will be whether banks and borrowers can translate the projected growth into tangible economic benefits while safeguarding credit quality.