The growth in non-food credit has remained above 30 per cent year-on-year for more than a year, while time deposits have recorded large accretion thus far.  "This partly reflects higher interest rates as well as availability of tax benefits under Section 80 C," the apex bank stated in its mid-term review.

Broad money growth accelerated to 19 per cent YoY as on October 13, from 16.8 per cent a year ago and remained above the indicative trajectory of 15 per cent projected in the RBI's annual policy statement.

On a fiscal year basis, broad money (M3) growth at 7.8 per cent was higher than the 6.1 per cent in the corresponding period of last fiscal.

Demand for bank credit from the commercial sector continued to remain strong during Q2 FY 07 with non-food credit of SCBs increasing by 9.8 per cent up to October 13 as against 11 per cent during the corresponding period of last fiscal.

On a YoY basis, non-food credit grew 30.5 per cent as on October 13. "Reflecting this, the incremental credit-deposit ratio of SCBs has remained high though it has exhibited some moderation in recent months," the RBI stated.