The banks have finally succeeded in meeting the target set by RBI for credit growth in the country. The fortnightly position of scheduled commercial banks of the country has revealed that the banks have been able to meet the target of 16% credit growth during this financial year.

The latest data from RBI said that the scheduled banks recorded a loan disbursement growth of 16.04% or Rs 4, 32,091 crore, to Rs 31, 24,850 crore at the end of March 12, 2010.

"Given the recent trend of improvement in credit demand, it makes easier for RBI to raise rates going forward," said Abheek Barua, chief economist, HDFC Bank.

Infrastructure sector has been the pioneer in credit off take, the other sectors have also seen an increase in credit, senior officials of RBI said.

Agriculture, housing, SMEs and trade sectors have shown an increase in credit off take.

"As liquidity in the banking system will remain adequate, credit expansion for sustaining the recovery will not be affected," RBI had said while increasing the repo rate by 25 basis points.

Earlier the banks had a pressure that they would have to lend Rs. 130k crore to meet the target set by RBI. The latest reports have shown that banks now need to lend Rs 88,364 crore to meet the target by the end of this month.

Deepak Mohanty, Executive Director, RBI said that credit growth in India was broad based. Infrastructure sector had been the major beneficiary in this regard. He also said that credit availability to corporates is not a hassle as they have increased access to overseas credit through ECBs.

The fortnight saw food credit grow by Rs 1,511 crore to Rs 49,402 crore. Also the deposits went up by Rs 39,612 crore to Rs 44, 02,943 at the end of March 12.