Today, the Reserve Bank released the results of 31st round of its quarterly Bank Lending Survey¹, which captures qualitative assessment and expectations of major scheduled commercial banks on credit parameters (viz., loan demand as well as terms and conditions of loans) for major economic sectors². The latest round of the survey, which was conducted during Q4:2024-25, collected senior loan officers’ assessment of credit parameters for Q4:2024-25 and their expectations for Q1, Q2 and Q3 of 2025-26.

Highlights:

A. Assessment for Q4:2024-25

• Bankers’ assessment on loan demand moderated across major sectors during Q4:2024-25, except agriculture, and retail/personal loans (Chart 1 and Table 1).

• Respondents reported continuation of easy loan terms and conditions for major sectors (Table 2).

B. Expectations for Q1:2025-26

• Bankers’ remained positive on loan demand from all major sectors during Q1:2025-26 though their level of optimism was somewhat lower or similar level as compared to the previous survey round (Table 1).

• Overall, easy loan terms and conditions are expected to prevail during the quarter (Table 2).

C. Expectations for Q2:2025-26 and Q3:2025-26

• Bankers’ outlook on loan demand from major sectors continue to remain positive till Q3:2025-26 (Table 3).

• Majority of bankers expect ‘no change’ in existing terms and conditions for loans.

Note: Please see the attached excel file for detailed time series data.

¹ The results of 30th round of the BLS with reference period as October-December 2024 were released on the RBI website on February 07, 2025. The survey results reflect the views of the respondents, which are not necessarily shared by the Reserve Bank.

² The survey questionnaire is canvassed among major 30 SCBs, which together account for over 90 per cent of credit by SCBs in India.

³ Net Response (NR) is computed as the difference of percentage of banks reporting increase/optimism and those reporting decrease/pessimism in respective parameter. The weights of +1.0, 0.5, 0, -0.5 and -1.0 are assigned for computing NR from aggregate per cent responses on 5-point scale, i.e., substantial increase/ considerable easing, moderate increase/ somewhat easing, no change, moderate decrease/ somewhat tightening, substantial decrease/ considerable tightening for loan demand/loan terms and conditions parameters respectively. NR ranges between -100 to 100. Any value greater than zero indicates expansion/optimism and any value less than zero indicates contraction/pessimism. Increase in loan demand is considered optimism (Tables 1), while for loan terms and conditions, a positive value of net response indicates easy terms and conditions (Table 2).