Four in ten new bank loans are flowing into power projects

What's going on here?

Research circulated on 8 October 2026 pointed to a sharp tilt in bank lending. Almost 40% of loan disbursements in the dataset went to power projects, with solar and wind making up most of that slice. The numbers come from Zerodha Capital’s work on where fresh bank credit is landing.

What does this mean?

When the RBI raises rates, you might expect banks to pull back everywhere. Instead, lenders are still funding long-dated assets where tariffs and power purchase agreements give some visibility. Solar and wind fit that mould. Transmission and thermal projects also sit in the power bucket, but the emphasis in the note is on renewable builds.

That matters for industrial policy. India needs more electrons on the grid as factories and data centres expand. Banks are voting with disbursements even as bond yields spike on the same day’s trading.

Why should I care?

Households do not pick loan books, but they feel the outcomes. More renewable supply can stabilise power costs over time. Heavy bank concentration in one sector also raises risk questions if projects slip on timelines. If you own bank shares or work in energy, watch whether this lending pace continues after the RBI’s tightening cycle. For everyone else, read it as a sign that clean power is still getting funded, not starved, in late 2026.