India’s retail credit growth moderated in the quarter ending June, as financial institutions tightened the supply of credit, particularly on consumption-led products like credit cards, consumer durable loans and personal loans, according to findings of the latest edition of the TransUnion CIBIL Credit Market Indicator (CMI) report.
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Although still positive for all consumer credit products other than credit cards and home loans, the CMI findings showed a decline in the year-over-year (YoY) growth rate of originations (new accounts opened) across the most popular credit products.
Originations growth among consumption-led credit products moderated in the quarter ending June, including personal loans.
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While overall originations continued to grow at a moderated rate, home loan originations dropped by 9% in volume, while credit card originations declined by 30% YoY.
Two-wheeler loans were the only credit product which had a double-digit growth in volume and value originated.
Credit performance, as measured by balance-level delinquencies, improved across most products, apart from credit cards, as per the findings.
Rajesh Kumar, MD and CEO, TransUnion CIBIL said, “Timely regulatory guidance and given the relatively high credit-deposit ratio, we are witnessing a moderation in retail credit growth.”
“Lenders can now look at identifying pockets of deserving consumers across risk segments to provide access to credit for them while driving the next phase of sustainable retail credit growth,” he said.