Personal loan growth spikes 32%, quarter soars 10%: CRIF-FIDC

The credit operations within India’s banking sector have been undergoing a noteworthy surge. This trend is unfolding within the context of an intriguing global landscape. The escalation of credit operations in India’s banking sector is evident through diverse manifestations: Upsurge in personal loans At the core of this surge in credit lies the category of .

Unravelling the destination of these trillions in personal loans poses a captivating and pivotal question. Discerning where this capital is directed enables us to assess the influence of credit expansion on the Indian economy and pinpoint potential areas of concern. The credit scenario is illuminated by the recently disclosed CRIF-FIDC data, which underscores the volume of loans extended by non-banking finance companies (NBFCs) in India during the last quarter of 2023-24.

Personal loans amounting to 64,778. 27 crores were disbursed, surpassing other loan categories such as auto loans, education loans, gold loans, and healthcare financing. Undoubtedly, a significant portion of these credits is allocated to consumption-based loans, including vehicle loans, credit card payments, loans against fixed deposits, gold, shares, bonds, education loans, and housing loans.

This observation doesn’t disregard the noteworthy trend of individuals seeking personal loans despite the upward trend in interest rates. The year-over-year surge in personal loans reached 32 per cent, and the quarter-over-quarter growth is approximately 10 per cent. Over the last two years, personal loan disbursements have surged by 141 per cent, underscoring the growing trend of individuals turning to credit for financial support.

Less interest in gold loans Even though loans against gold, amounting to 41,275. 27 crores, were sought, there has been a substantial 30 per cent decrease in the demand for gold loans compared to the previous quarter. The heightened amount of housing loans reflects an expanding extension of credit, supporting the resilient housing market in India, influenced by competitive interest rates and government incentives.

More demand for vehicle loans It’s worth noting the significant prominence of vehicle loans in India’s lending landscape, and your analysis of the factors fuelling this surge is accurate. The total vehicle loan volume in the second quarter of 2023-24 exceeded 57,000 crores. The upswing in vehicle loans undeniably contributes to the well-being of the Indian economy.

It invigorates the automobile industry, generates employment, and enhances personal mobility. The ascent of vehicle loans in India is a multifaceted phenomenon propelled by a convergence of economic, technological, and social factors. Grasping these influential forces is essential for policymakers, lenders, and individuals alike to guarantee the sustained positive impact of this trend on the economy and individual welfare.

Education loans on a high In the last 12 months, consumer loans have experienced a 26 per cent increase. The rise in consumer-driven credit in India signifies various intriguing trends, such as a flourishing consumer market, elevated lifestyles, strong economic activity, and enhanced financial inclusion. The significant increase in educational loans, surpassing 12,000 crores, paints a captivating picture of various trends in India.

Firstly, the escalating volume of education loans indicates the expanding access to higher education in the country. Additionally, Indian families, rooted in a strong cultural emphasis on education as a pathway to upward mobility and enhanced career prospects, are inclined to invest in higher education, even if it involves taking on loans. Moreover, there is a growing awareness among students about the transformative potential of credit in investing in their skills and future careers.

Educational loans enable them to pursue higher education and specialised training programs that might otherwise be financially challenging. This, in turn, can result in increased earning potential and elevated living standards over time. Furthermore, the surge in has positive implications for the Indian economy at large.

A more educated workforce contributes to higher productivity, innovation, and overall economic growth. This investment in human capital is pivotal for India’s sustained development on the global stage. Rising medical loans, a concerning fact The substantial share of personal loans dedicated to healthcare finance underscores a pressing challenge in India: The escalating burden of healthcare expenses combined with inadequate insurance coverage for a significant portion of the population.

This pattern emphasises the need for prompt policy intervention to enhance the financial well-being of citizens. India confronts a dual challenge concerning expenses. On one front, medical inflation is surpassing the general rate, resulting in a gradual increase in treatment costs.

Simultaneously, due to a substantial informal sector and constrained government healthcare expenditure, a considerable segment of the population lacks sufficient . This situation exposes individuals and families to financial vulnerability when confronted with unforeseen medical emergencies. Exploring India’s landscape is akin to delving into a wealth of insights into the nation’s economic heartbeat at the household level.

It unfolds a narrative inscribed in trillions of rupees, laying bare aspirations, challenges, and a shared vision for the future intricately woven into the tapestry of expenditure patterns. Livemint tops charts as the fastest growing news website in the world to know more. Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it’s all here, just a click away!.