The number of credit card accounts increased by nearly 32% in the last year to 36.9 million in CYQ3 2018.
Personal loan accounts of both banks and shadow banks combined rose to 15 million during the quarter ended October 2018 due to a 26% increase in the last year. These loans are small sized loans in the range of Rs 1-5 lakh and even their tenure is less than five years. The number of credit card accounts, where outstanding are generally less than Rs one lakh per account increased by nearly 32% in the last year to 36.9 million during the period.
The study notes that average balances per borrower is Rs 2.52 lakh, up 7.7 per cent over the previous year. While serious delinquency rates is 0.52 percent, down one basis points over previous year(one basis point is 0.01 per cent).
Serious delinquency rates are measured as the percentage of balances which are 90 or more days past the due date.
Significantly, the delinquency rate in personal loans or unsecured loans is the lowest among all retail loan products analysed in the study. Delinquency rate for loan against property is highest at 3 per cent followed by auto loans segment which has delinquency rate of 2.75 per cent.
“From a consumer perspective, it’s immensely important that borrowers understand the importance of continuing to make on-time payments” said Yogendra Singh, Vice President of Research and Consulting for TransUnion CIBIL. “These emerging consumers are beginning to play a larger role in the Indian economy, and their ability to access and successfully manage credit will be critical to the future growth and health of the economy”
In the absence of demand from large corporate borrowers and also fear of the asset turning bad, lenders have seen their loan book growth largely through retail assets.