India’s consumer loan portfolio grew 15.2 per cent year-on-year to Rs 90.3 trillion as of March 2024, according to the latest report by the credit agency.
The fourth edition of the CRIF High Mark report noted a slowdown from the 17.4 percent growth recorded in March 2023, largely due to a slowdown in the mortgage loan segment, which accounts for 40.1 percent of the total consumer loan portfolio by value.
The mortgage loan portfolio saw its growth slow to 7.9 percent year-on-year in FY24, down from 23 percent expansion seen in FY23. This was primarily due to moderate growth in originations, which increased 9.2 percent in FY24 compared to 18.2 percent in the previous fiscal year.
Origination refers to the process by which a lender creates or initiates a new loan or credit, including evaluating, processing and approving a borrower’s application.
The report finds a shift towards higher ticket sizes, with a growing preference for loans above Rs 35 lakh, even as the average ticket size (ATS) rose 32 per cent from Rs 20.1 lakh in FY20 to Rs 26.5 lakh in FY24.
In contrast, the personal loan segment maintained strong momentum, growing 26 per cent YoY in FY24 despite recent regulatory reforms. Larger loans of Rs 10 lakh and above increased their share in originations by value, while loans of less than Rs 1 lakh continued to dominate in volume.
Banks led value-based originations, while non-banking financial companies (NBFCs) remained dominant in volume.
Two-wheeler loans saw a year-on-year growth of 34 per cent in FY24, up from 30 per cent in FY23, driven by a shift towards higher-dollar loans. However, overall origination volume grew at a slower pace of 13 per cent in FY24 compared to 32 per cent in FY23. Auto loans, on the other hand, grew 20 per cent year-on-year in FY24, compared to 22 per cent in FY23.
Consumer durable loans recorded robust growth of 34 percent year-over-year in fiscal 2024, up from 26 percent expansion in the previous fiscal year. This growth was driven by a shift toward larger amounts, although origination volumes grew only 8.5 percent in fiscal 2024, compared to 38.2 percent in fiscal 2023.
The MSME lending segment showed mixed results as individual MSME loans grew faster than entity MSME loans. The individual MSME portfolio grew 29 percent year-on-year in FY24, accelerating from 15 percent in FY23, while entity MSME loans grew only 6.6 percent year-on-year, a marked deceleration from 17.2 percent in the previous year.
Microfinance lending also saw strong growth: the portfolio increased 27 percent year-on-year in FY24, compared to 21 percent in FY23.
“The resilience of the Indian credit market is evident from the strong performance across loan categories and stable delinquencies. Mortgage loans remain dominant, but growth in personal loans, two-wheeler loans and the uptick in NBFCs highlight significant changes in the credit landscape,” said Sanjeet Dawar, Managing Director, CRIF High Mark.
(Only the headline and image of this report may have been reworked by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
First published: September 11, 2024 | 18:45 IS
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