Bank credit to the services sector surged 28.3% year-on-year in September, accelerating sharply from 9.9% a year earlier, as lending to non-banking financial companies, trade, commercial real estate, transport operators and professional services supported growth, Reserve Bank of India data showed.

Overall non-food bank credit grew 19.1% year-on-year for the fortnight ended September 30, compared with 11.2% in the corresponding fortnight of the previous year. The data, collected from 41 select scheduled commercial banks accounting for about 95% of total non-food credit, pointed to elevated lending growth across most key segments.

Services credit recorded the fastest expansion among the major sectors, with its growth rate nearly tripling from a year earlier. The acceleration was supported by buoyant lending across several service industries, including NBFCs, which rely on bank funding to support their own lending operations.

Credit to industry also accelerated, growing 19.5% year-on-year in September compared with 7.7% in the corresponding fortnight last year. Lending to large and medium industries expanded at a faster pace, while credit to micro and small industries continued to register steady growth.

Among major industrial segments, infrastructure, basic metal and metal products, all engineering, chemical and chemical products, food processing, and textiles recorded buoyant year-on-year credit growth. The broad-based expansion indicates stronger bank lending across manufacturing and infrastructure-linked activities.

Credit to agriculture and allied activities rose 19.5% year-on-year, more than doubling the 8.9% growth recorded a year earlier. The acceleration points to stronger credit deployment in the agricultural sector during the period.

Personal loan growth also strengthened, rising 17.3% year-on-year compared with 11.5% in the corresponding fortnight of the previous year. Housing and vehicle loans continued to record resilient growth, while advances against fixed deposits accelerated.

However, growth in loans against gold jewellery and education loans moderated compared with a year earlier, although both segments continued to record strong expansion.

The September data show that bank credit growth strengthened across all four major sectors, with services leading the expansion, followed by industry and agriculture. Personal loans also maintained momentum, supported by housing and vehicle financing.

The acceleration in overall non-food credit to 19.1% from 11.2% a year earlier underscores the strength of bank lending at the end of the first half of 2026-27. The particularly sharp rise in services credit highlights the sector's growing role in driving credit demand, alongside the recovery in industrial and agricultural lending.