<p><strong>By Suvashree Ghosh</strong><br />Indian banks’ loan growth will slow to nil to 1% in the year started April 1, according to the Indian unit of S&P Global Ratings.</p>.<p>That’s lower than 6.1% the previous fiscal year, which was already a multi-decade low. Corporate borrowings, which account for half of total credit, will be worst-hit and loans to individuals will decelerate to “low single digits” from “mid teens” in the past few years, Crisil Ltd. said in a report Monday.</p>.<p><strong>Read: <a href="https://www.deccanherald.com/business/coronavirus-effect-india-facing-its-worst-recession-in-current-fiscal-says-crisil-842077.html" target="_blank">Coronavirus Effect: India facing its worst recession in current fiscal, says Crisil</a></strong></p>.<p>Reeling under the worst bad-loan ratio in the world, Indian banks have turned risk-averse as the strict shelter-at-home rules have shuttered businesses and left millions jobless. Prime Minister Narendra Modi is counting on fresh credit to spur an economy hurtling toward a rare contraction.</p>.<p>“This crisis is unprecedented and so will its economic fallout be,” said Crisil’s Senior Director Krishnan Sitaraman.</p>.<p>Even before the <a href="https://www.deccanherald.com/tag/coronavirus" target="_blank">coronavirus</a> pandemic, India’s $1.7 trillion financial sector had been weakened by a festering shadow banking crisis that surfaced in 2018 and spilled over into banks and mutual funds, pushing up bad loans and eventually leading to the bailout of a private sector bank in March.</p>.<p>Crisil predicts loan growth will pick up to high single digits in the next financial year.</p>
<p><strong>By Suvashree Ghosh</strong><br />Indian banks’ loan growth will slow to nil to 1% in the year started April 1, according to the Indian unit of S&P Global Ratings.</p>.<p>That’s lower than 6.1% the previous fiscal year, which was already a multi-decade low. Corporate borrowings, which account for half of total credit, will be worst-hit and loans to individuals will decelerate to “low single digits” from “mid teens” in the past few years, Crisil Ltd. said in a report Monday.</p>.<p><strong>Read: <a href="https://www.deccanherald.com/business/coronavirus-effect-india-facing-its-worst-recession-in-current-fiscal-says-crisil-842077.html" target="_blank">Coronavirus Effect: India facing its worst recession in current fiscal, says Crisil</a></strong></p>.<p>Reeling under the worst bad-loan ratio in the world, Indian banks have turned risk-averse as the strict shelter-at-home rules have shuttered businesses and left millions jobless. Prime Minister Narendra Modi is counting on fresh credit to spur an economy hurtling toward a rare contraction.</p>.<p>“This crisis is unprecedented and so will its economic fallout be,” said Crisil’s Senior Director Krishnan Sitaraman.</p>.<p>Even before the <a href="https://www.deccanherald.com/tag/coronavirus" target="_blank">coronavirus</a> pandemic, India’s $1.7 trillion financial sector had been weakened by a festering shadow banking crisis that surfaced in 2018 and spilled over into banks and mutual funds, pushing up bad loans and eventually leading to the bailout of a private sector bank in March.</p>.<p>Crisil predicts loan growth will pick up to high single digits in the next financial year.</p>