Private sector borrowing peaks to Rs. 221.5 b in June

Monday, 11 August 2025 06:00 - - {{hitsCtrl.values.hits}}

Private sector borrowings picked up in June 2025 to Rs. 221.5 billion, the highest for the year, resulting in the outstanding amount crossing Rs. 8.85 trillion.

According to the latest Central Bank of Sri Lanka (CBSL) data, banking sector credit to the private sector in June amounted to Rs. 221.5 billion, up 17.9% from a year ago.

The amount borrowed in June was the highest for 2025 so far, beating the record set in March of Rs. 158 billion. In April, credit demand was low at Rs. 87 billion, a development linked to the Sinhala-Tamil New Year holidays.

February saw Rs. 105 billion in demand for credit, whilst January suffered a reduction of Rs. 4.6 billion following a recent high of Rs. 193 billion in credit demand in December 2024.

In July, the CBSL noted that the economy recorded a firm growth of 4.8% in the first quarter of 2025, and leading economic indicators suggest this growth momentum will continue in the near term. Monetary conditions continued to ease, supporting the rebound in domestic economic activity. The expansion of credit to the private sector has remained robust so far in 2025, and expansion is expected to continue.

CBSL Governor Dr. Nandalal Weerasinghe in July said there was no concern amid the credit expansion. “We don’t see signs of overheating. This credit growth comes after a sharp contraction following the crisis. What we witness is a recovery. So, this growth is healthy and broad-based,” he said.

Meanwhile, the Government borrowed only Rs. 98 billion from domestic banks in June, taking the total outstanding to Rs. 6.6 trillion, up 8.2% from a year ago.

Domestic banking credit to public corporations declined by Rs. 1.3 billion, taking the total outstanding credit to Rs. 584.1 billion, down 11% from a year ago.

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