April 2022

Personal Loans and Home Loans dominated festive lending from FY19 to FY22, shows CRIF High Mark’s How India Celebrates – Report on Festive Lending in India

The report analyses key trends across major consumer lending products during the festive season i.e., Q3 every year, from FY19 - FY22

 

CRIF High Mark launched its inaugural report titled How India Celebrates – Report on Festive Lending in India. The report highlights overall trends and movement across key consumer lending products i.e., Personal, Home, Consumer Durable, Two-Wheeler, and Auto loans during the festive season - Q3 every year (October – December), from FY19 – FY22. The report deep dives into originations by value and volume across each product, lender type, geography along with early delinquency trends.

Personal loans and Home loans outshine across all 4 financial years

Personal loans outshined all other products by witnessing nearly 2X growth in originations (value) during festive season from Rs 75,088 crore in FY 19 to Rs 147,236 crore in FY22, and 4X growth in originations (volume) from 39.9 lakh accounts in FY19 to 158.1 lakh accounts in FY22. Home loans witnessed 40% growth in originations (value) during festive season from Rs 138,544 crore in FY19 to Rs 193,227 crore in FY22, and 21% growth in originations (volume) from 6.7 lakh accounts in FY19 to 8.1 lakh accounts in FY22. Key trend to note is that share of Q3 in originations (value) increased from FY19 to FY21 for all products.

Performance of major loan products

Below are the key trends observed during festive season (Q3 – October to December, from FY19 – FY22) across major consumer lending products – Personal, Home, Consumer Durable, Two-Wheeler and Auto loans -

  • Personal loans witnessed nearly 2x growth in originations (value) from Rs 75,088 crore in FY19 to Rs 147,236 crore in FY22, and 4X growth in originations (volume) from 39.9 lakh accounts in FY19 to 158.1 lakh accounts in FY22. There was an increase in originations share (value) of Public Sector Banks and NBFCs from Q3 of FY19 – FY22. Private banks witnessed a decline during the same period. However, Public Sector Banks saw a decline in originations share (volume), whereas Private Banks and NBFCs saw an increase, during the same period
  • Home Loans saw 40% growth in originations (value) from Rs 138,544 crore in FY19 to Rs 193,227 crore in FY22, and 21% growth in originations (volume) from 6.7 lakh accounts in FY19 to 8.1 lakh accounts in FY22. There was an increase in originations share (both value and volume) of Private Banks from Q3 of FY19 – FY22, whereas Public Sector Banks and HFCs observed a decline during the same period
  • Consumer Durable Loans achieved 32% growth in originations (value) from Rs 19,683 crore in FY19 to Rs 26,075 crore in FY22, and 33% growth in originations (volume) from 91.6 lakh accounts in FY19 to 121.9 lakh accounts in FY22. There was an increase in originations share (both value and volume) of Private banks from Q3 of FY19 – FY22, and even though the category is dominated by NBFCs, there is a decline in their share
  • Two-Wheeler Loans saw flat growth in originations (value) from Rs 16,393 crore in FY19 to Rs 15,281 crore in FY22 and 29% decline in originations (volume) from 28.7 lakh accounts in Q3 FY19 to 20.4 lakh accounts in Q3 FY22. There was a decline in originations share (both value and volume) of Private banks and NBFC – Captives during festive season. NBFC – Others witnessed growth during the same period
  • Auto Loans witnessed flat growth in origination (value) from Rs 54,367 crore in FY19 to Rs 56,420 crore in FY22. Originations (volume) in Q3 FY19, Q3 FY20 and Q3 FY21 remained above 10 lakh accounts. However, in Q3 FY22, it dropped to 8 lakh accounts. There was an increase in originations share (both value and volume) of Public Sector Banks and Private Banks from Q3 of FY19 – FY22, whereas NBFCs witnessed a decline

 

South and West India dominate in originations

According to the report, South and West India dominate in originations. Among the top 10 states, originations (value) is highest in Maharashtra for Auto, Personal, Consumer Durable and Home loans, and Uttar Pradesh for Two-Wheeler loans. Among the top 15 districts, most are from southern and western parts of the country, with Jaipur, NCR and Kolkata being the exceptions. Originations (value) is the highest in Bengaluru across all products, with Home loans and Personal loans dominating, followed by Auto loans and Consumer Durable loans.

Mr. Navin Chandani, MD & CEO, CRIF High Mark, said, “Our inaugural report, How India Celebrates – Report on Festive Lending in India, was developed to capture the key trends and movements for major consumer lending products. Our data from FY19 – FY22 shows that lending sector is boosted by significant demand across major consumer products during the festive season; it continues to be the most preferred period to make important, high-value purchases. We are certain that our insights will aid all key players in the consumer sector (companies, manufactures and lenders) to leverage the strong consumer demand during the festive season in an improved manner, and build a collaborative ecosystem, that will boost the lending community at large.”

How India Celebrates – Report on Festive Lending in India is an inaugural report from CRIF High Mark on festive season lending in India. The report analyses trends and movements for major consumer lending products: Personal, Home, Consumer Durable, Two-Wheeler, and Auto loans during festive season compared to the rest of the year. For the purpose of this report, festive season in India is defined as the third quarter of the financial year (October - December).

Download and read the full report

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