Total credit provided to the private sector by banks and other lenders rose by 0.2 per cent in July after a rise of 0.3 per cent in June and an increase of 0.5 per cent in May.

It was the slowest monthly rise since January, according to the seasonally adjusted data released by the Reserve Bank of Australia (RBA) on Friday.

Over the year to July, total credit rose by 4.2 per cent, the Reserve Bank of Australia (RBA) said.

A year earlier, the annual growth rate was 3.0 per cent.

Even at the higher rate of the past year, credit growth is still a fraction of the 10 per cent plus growth rates that applied from mid-2002, after the world recession and through to late 2008, when the global financial crisis crushed both demand for credit and the willingness of lenders to supply it.

Credit growth over the most recent three months was 4.1 per cent on an annualised basis, very close to the growth rate over the latest 12 months, suggesting the trend in credit growth is not accelerating beyond its current placid pace.