New Delhi: Bank lending to India's commercial sector increased sharply during April-August of the current financial year (FY27), even as corporate bond issuances by non-financial companies declined amid rising bond yields, according to the Finance Ministry's October Monthly Economic Review. Total financial resources flowing to the commercial sector from banks and non-bank sources increased by 55.4% to Rs 17.5 lakh crore during April-August FY27, compared with Rs 11.2 lakh crore in the corresponding period last year, ANI reported.

Source: ANI via Devdiscourse

"The primary source of this growth has been non-food bank credit, amounting to Rs 9.8 lakh crore, up from Rs 3.8 lakh crore a year earlier; corporate bond issuances by non-financial entities, by contrast, fell to Rs 0.3 lakh crore from Rs 1.5 lakh crore over the same period as bond yields moved up," the review stated, as reported by The Hindu BusinessLine.

Source: The Hindu BusinessLine

Rs 17.5 lakh croreTotal funds to commercial sector, Apr-Aug FY27 — up 55.4%
Rs 9.8 lakh croreNon-food bank credit — up from Rs 3.8 lakh crore
Rs 0.3 lakh croreCorporate bond issuance — down from Rs 1.5 lakh crore
21.6%Bank credit growth year-on-year as of Sep 30

As of September 30, bank credit had registered an increase of 21.6% year-on-year, up from 10.4% a year ago, with non-food credit registering growth of 21.4%, the report said. Credit to industry grew 18.2% year-on-year in August 2026, compared with 7.0% a year earlier — lending to medium industries rose 31.8%, followed by micro and small industries at 23.0% and large industries at 14.9%.

Source: ANI via Devdiscourse

Citing the Reserve Bank of India's latest bank lending survey for the second quarter of FY27, the review said banks reported stronger loan demand across sectors, with the loan demand net response rising to 46.7 from 32.1 in the preceding quarter, and expectations for the third quarter standing at 43.3. The Finance Ministry expects the momentum in bank credit to continue through the remainder of FY27.

Source: The Hindu BusinessLine

The lending figures come from the same October Monthly Economic Review that estimated India's Q2 FY27 GDP growth at 7.35% through the Finance Ministry's nowcasting model, a development reported separately on this site. The review's bank-lending data show businesses leaning far more heavily on banks than on bond markets this year, as higher yields made market borrowing less attractive for non-financial companies.

Source: ANI via Devdiscourse