RBI report – Artifex.News

Demand driving growth, but economic outlook ‘somewhat clouded’ by supply issues: RBI

admin — Fri, 22 May 2026 13:05:00 +0000

The Reserve Bank of India (RBI) logo inside its headquarters in Mumbai.
| Photo Credit: REUTERS

While India’s domestic demand remains a key driver of growth, the near-term outlook for the economy is “somewhat clouded” due to supply side pressures brought on by the West Asia crisis, the Reserve Bank of India (RBI) said in a new report.

“Domestic demand continues to be the key driver of growth,” the RBI said in its latest State of the Economy report as a part of its monthly bulletin for April 2026. “However, the near-term outlook is somewhat clouded by supply side pressures.”

“Although headline inflation remains firmly within the tolerance band, the pass through to domestic prices needs to be monitored,” it added. “The financial conditions, crude oil prices and capital flows continue to pose challenges to the external sector outlook.”

Mixed demand conditions

The central bank noted that, while e-way bills continued to hit double-digit growth, and petrol and diesel consumption continued to grow, overall petroleum consumption fell in April due to a sharp fall in the consumption of naphtha, liquified petroleum gas (LPG) and other petroleum products.

Similarly, while higher temperatures led to a sharp increase in electricity demand, the monthly number of toll transactions continued to decline, although the RBI attributed this to the introduction of the FASTag Annual Pass scheme in August 2025.

“Demand remained broad-based and supported by rural markets,” the RBI noted. “Automobile sales in rural areas continued to grow at double digit in April, although showing some sequential moderation. The tractors and two-wheelers sales within the automobile segment in rural and passenger vehicles sales in urban areas continued to witness robust growth.”

On the other hand, it added that, due to the increase in prices of aviation turbine fuel, the air passenger traffic declined further in April.

Labour market worsens

Notably, the central bank said that labour market conditions witnessed some moderation in the January-March 2026 quarter, with the labour force participation rate and worker population ratio declining alongside a rise in the unemployment rate, which it said was largely driven by rural areas.

“It was, however, accompanied by an increase in the share of regular salaried employment, with higher employment in the secondary and tertiary sectors,” the RBI noted.

Higher costs affect supplies

On the supply side, the RBI said that sowing in the summer season has been “progressing well”, surpassing the full season normal acreage and is higher than the previous year. It added that the acreage under all major crops is higher, except for rice.

“Based on high frequency indicators, industrial activity exhibited resilience in April, despite the ongoing West Asia conflict,” the RBI said. “The index of eight core industries witnessed an uptick, supported by cement, steel and electricity production. Manufacturing PMI also rose marginally as cost pressures and geopolitical spillovers kept growth momentum in new orders and output slow.”

On the services front, the central bank said that the sector remained resilient in April. However, it added that while the Services PMI accelerated, supported by a boost in transportation activity enabled by domestic suppliers and new business orders, the pace of export orders “displayed weakness”, hit by the war in West Asia and subdued inbound tourism.

Published – May 22, 2026 06:35 pm IST

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Number Of Credit Cards More Than Doubled In 5 Years: RBI

admin — Tue, 28 Jan 2025 05:27:18 +0000

New Delhi:

The number of credit cards has more than doubled to around 10.80 crore at the end of December 2024, compared to December 2019 when there were 5.53 crore cards in circulation, according to a new RBI report.

In contrast, number of debit cards have remained relatively stable, with a marginal increase from 80.53 crore in December 2019 to slightly more than 99.09 crore in December 2024.

A similar growth trajectory is witnessed in card transactions as well, said the RBI report. During CY2024, there were 447.23 crore and 173.90 crore payment transactions worth of Rs 20.37 lakh crore and Rs 5.16 lakh crore through credit and debit cards, respectively.

“While the use of debit cards has declined, credit cards have grown more than 15 per cent on a year-on-year basis in recent years,” it mentioned.

As of December 2024, the financial landscape in India is characterised by the widespread adoption of credit and debit cards, with an astounding 109.9 crore cards circulating throughout the country.

The credit card issued by public sector banks (PSBs) increased from 122.6 lakh as at end-December 2019 to 257.61 lakh as at end-December 2024, a more than 110 per cent jump.

“Private sector banks (PVBs), who hold a 71 per cent market share with 766 lakh cards in December 2024, have leaned into digital solutions and co-branded cards to cater to urban and affluent customers,” the RBI report noted.

Meanwhile, foreign banks have seen a decline both in numbers — from 65.79 lakh cards to 45.94 lakh — and in market share, dropping from 11.9 per cent to 4.3 per cent between December 2019 and December 2024, possibly due to high fees and conservative lending policies.

Small finance banks (SFBs) have entered the arena with 10.97 lakh cards as at end-December 2024, targeting the underserved and focusing on financial inclusivity.

With effect from January 1, 2019, the RBI has mandated the use of only EMV Chip and PIN-based debit and credit cards.

Also, the scope of UPI was expanded by permitting linkage of RuPay credit card to UPI for making payments. Subsequently, it has been expanded by permitting transfer to/from pre-sanctioned credit lines issued by scheduled commercial banks, in addition to deposit accounts.

“In other words, UPI network will facilitate payments financed by credit from banks. This can reduce the cost of such offerings and help in development of unique products for Indian markets,” said the report.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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High Employee Attrition of 25% In Private Banks Pose Operational Risk: RBI Report

admin — Sun, 29 Dec 2024 11:08:25 +0000

New Delhi:

Employee attrition in private sector banks has witnessed an increase to about 25 per cent and this high turnover rate poses significant operational risk, according to the latest Report on Trend and Progress of Banking in India 2023-24.

Employee attrition rates are high across select private sector banks and small finance banks (SFBs), the report, which was released by the Reserve Bank of India (RBI) said.

The total number of employees of private banks surpassed that of public sector banks (PSBs) during 2023-24, but their attrition has increased sharply over the last three years, with average attrition rate of around 25 per cent, it said.

“High attrition and employee turnover rate pose significant operational risks, including disruption in customer services, besides leading to loss of institutional knowledge and increased recruitment costs. In various interactions with banks, the Reserve Bank has stressed that reducing attrition is not just a human resource function but a strategic imperative,” it said.

Banks need to implement strategies like improved onboarding processes, providing extensive training and career development opportunities, mentorship programmes, competitive benefits, and a supportive workplace culture to build long-term employee engagement, it said.

In view of several irregularities observed in grant of loans against gold ornaments and jewellery, including top-up loans, the Reserve Bank advised supervised entities to comprehensively review their policies, processes and practices on gold loans to identify gaps and initiate appropriate remedial measures in a time-bound manner.

Supervised entities were advised to closely monitor their gold loan portfolios and ensure adequate controls over outsourced activities and third-party service providers, it said.

The report said climate change risks are envisaged to impact profitability of financial institutions, growth prospects, and inflation dynamics and, thus, impinge upon financial stability and price stability.

To foster assessment of these concerns by regulated entities, regulatory and supervisory frameworks need to be strengthened with enhanced risk management guidelines, disclosure requirements, periodic stress testing, and stipulating reasonable verification and assurance functions, it added.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

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