RBI survey shows optimism in bank lending; loan demand set to rise across sectors

The Reserve Bank of India (RBI) has announced findings from its 33rd quarterly Bank Lending Survey among scheduled commercial banks, revealing sustained confidence among lenders regarding credit growth during Q2 2025-26. The assessment covers current lending conditions and projections for Q3-Q4 FY26 and Q1 FY27.

Bankers reported strengthened loan demand across all major sectors during the April-June 2025 quarter, with particular momentum observed in agriculture, manufacturing, infrastructure, and services. Survey participants expressed continued confidence in credit expansion for Q3 FY26, citing expectations of accelerated borrowing in core economic segments.

Quantitative indicators show the net response for overall credit demand reached 38.9% in Q2 FY26, up from 37.5% in the preceding quarter. Sectoral analysis reveals:

• Agricultural loans rose to 39.7% net response
• Manufacturing sector demand climbed to 37.5%
• Services industry optimism remained strong at 35.2%
• Retail/personal loans maintained 37.5% net demand

Forward projections indicate heightened expectations for Q3 FY26, with overall demand anticipation reaching 42.6%. Key sector forecasts include:

• Agriculture: 44.8%
• Manufacturing: 44.6%
• Infrastructure: 34.5%

The survey shows sustained optimism for subsequent quarters, with consistent 44.6% net responses projected for both Q4 FY26 and Q1 FY27. Banking respondents anticipate maintaining favorable lending terms, with net easing responses expected to rise progressively:

• Q3 FY26: 18.5%
• Q4 FY26: 20.4%
• Q1 FY27: 24.1%

Conducted among 30 major banks representing over 90% of India’s credit market, the survey provides crucial insights into credit market dynamics across economic sectors.

Published on October 3, 2025