Provision of bank loans: Retail is racing ahead, says CARE-Ratings
Non-food credit growth accelerated to 6.8% yoy in September 2021, up from 5.1% growth in September 2020, and grew 162 basis points (bps) yoy and 07 bps m / m. Month (mom) due to the relaxation of lockdown restrictions and the start of the festival season, CARE Ratings announced.
“Growth was driven by the Retail, Agriculture & Allied and Industrial segments, with Services experiencing sluggish growth. Agriculture & Related Businesses segment lending increased 9.9% in September 2021 due to increased demand in rural areas due to an estimated higher production for the harvest of Kharif, “CARE Ratings said in a report
Retail / Personal Loans
“Retail / Personal Loans segment lending (currently the largest segment) grew 12.1% year-over-year in September 2021 (similar to the growth rate in August 2021), largely driven by growth in residential real estate, vehicles, gold jewelry and other personal loans (Sub-segments) due to the festive season and the gradual opening of the Indian economy.
According to media comments, property registrations in Mumbai were up 35% from September 2021, while residential property sales increased 47% in India’s seven major cities from January to September 2021.
“Loans for house purchase (50.7% share in retail) grew by 9.0% in September 2021 compared to 8.2% a year ago. The home loan segment was also driven by growth in affordable housing and low interest rates. Other personal loans (29% share in retail banking) rose 18.2% in September 2021 from 11.4% a year earlier for unsecured loan growth through their digital platforms, “said Care Ratings.
“The home loan segment was also driven by growth in affordable housing and low interest rates. Durable consumer goods (share of 0.4% in retail) recorded significant growth of 40% in September 2021 compared to growth of 14.9% per year. 5%, the lending business for gold jewelry (share around 2.2% in retail) recorded the highest growth of 59.1% compared to an increase of 42.3% in September 2020. The SBI gold loan portfolio recorded strong growth of 338 in Q1FY22 , 7%, driven by basic medical needs and job losses due to the second wave of Covid-19, however, growth slowed to 91% private versus stocks, bonds etc in Q2FY22, and education saw a 25 decrease over the reporting period , 4% and 2.9% growth during the period, respectively, “it says.
As for the priority sector, Care Ratings found that overall priority sector lending in September 2021 was estimated to have increased 5.6% to 39.6 billion weaker sections due to the ELCGS program and higher production for the production of Kharif will.
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Story first published: Thursday, November 11, 2021, 11:22 am [IST]