MUMBAI, Nov 22 Reuters India39;s central bank Governor Shaktikanta Das on Wednesday cautioned the country39;s lenders against all forms of exuberance days after tightening rules for consumer loans.

While credit growth is accelerating, banks and non bank finance companies NBFCs need to ensure lending to individual categories is sustainable, Das said at an event in Mumbai.

All forms of exuberance must be avoided.

Last week, the Reserve Bank of India RBI asked banks to set aside more capital against personal loans and lending via NBFCs on concerns that soaring demand for smallticket consumer credit could lead to a buildup of risk.

The tightening of lending norms is expected to push up borrowing costs and dent consumer loan growth, which has been rising at nearly double the pace of overall bank credit.

These measures are preemptive in nature; they are calibrated and targeted, Das said on Wednesday.

Das also asked lenders to be watchful of a buildup of stress due to new lending models.

Banks and NBFCs need to be careful in relying solely on preset algorithms for taking lending decisions, he said.

The RBI last week did not tighten capital norms for home loans, vehicle loans and gold loans.

The central bank does not currently see signs of stress in housing or vehicle loans, the governor said on Wednesday.

However, he flagged risks that may emerge from the interconnectedness between banks and NBFCs, and asked nonbank lenders to widen their sources of funding.

The…