NBFC loans grow 14.2% to Rs 58. 6L crore, trail banks

Mumbai: NBFCs or shadow banks as central banks see them are growing more slowly than their regulated counterparts, even as a burst of small-ticket borrowing keeps their loan books ticking over.NBFC lending rose 14.2% year-on-year to Rs 58.6 lakh crore at end-May 2026, trailing the 17.7% pace of banks which have a Rs 215 lakh crore loan book, according to RBI data. Yet, the deceleration in annual growth masks a pickup from 11.4% a year earlier, helped along by a surge in loans against gold jewellery, which expanded 6% in the two months to May and 70% year-on-year to Rs 3.3 lakh crore.The central bank has, for the first time, published data on the sectoral deployment of NBFC credit.

According to the data, NBFCs added Rs 84,544 crore between March and May 2026, a 1.5% increase that is roughly twice the pace of bank lending over the same period. Banks typically see slower credit growth in the first quarter, as companies repay dues after year-end balance-sheet adjustments.The incremental expansion is strikingly concentrated. Of the Rs 84,544 crore added, retail loans accounted for Rs 81,161 crore, taking the segment's outstanding stock to around Rs 25.2 lakh crore.

By contrast, credit to industry shrank by Rs 17,424 crore, dragged down by infrastructure lending, which fell by Rs 18,092 crore, including a Rs 9,553 crore decline in the power segment.Within retail, growth is led by collateralised borrowing. Loans against gold jewellery contributed Rs 19,808 crore, or 23.4% of incremental credit, followed by vehicle loans (Rs 13,840 crore), housing loans (Rs 13,413 crore) and consumer durables (Rs 9,991 crore).Services added Rs 10,116 crore, or 11.97% of incremental credit, with commercial real estate accounting for most of the increase at Rs 11,834 crore, offsetting a marginal Rs 90 crore decline in transport operators. Other loans contributed Rs 7,923 crore or 9.37%, while agriculture and allied activities added Rs 2,766 crore or 3.3%.