Domestic credit to private sector refers to loans, trade credits or any financial resources provided to an economy's private sector by banks and financial institutions.
As per the World Bank data, global domestic credit to private sector as a percentage of global GDP rose >12% year on year in 2020. To spur economic activity post COVID, governments across the world cut interest rates and provided cheap credit to help businesses sustain in the backdrop of uncertain demand conditions. Some of the bigger economies - USA, France, Italy, Russia - saw a higher growth in lending to the private sector (as a percentage of GDP) than the world average.
China and India both saw a double digit growth in lending to the private sector but this was below the global growth of 12.2% y-o-y. Data for 2020 is unavailable for KSA and the UAE but Qatar showed a whopping 35.7% rise in credit to private sector (as a percentage of GDP) compared to 2019.
