In the December quarter of this financial year, NBFCs surpassed banks far behind in terms of growth of unseen personal loans. The RBI relaxed NBFCs to the rules related to loans from banks. This may be the cause of greater growth of NBFC’s unseen personal loans in the December quarter. RBI’s measures to reduce the interest rate, to reduce monetary policy and increase liquidity can also be a hand.
NBFC’s personal loan book boom
According to data from brokerage firm Nomura, in October-December quarter NBFC The growth of the personal loan book was 37 percent. In comparison, the growth of the entire system including banks was only 16 percent. The report said that NBFC’s unseen loan increased by 2.6 times in the December quarter, while the system increased just by 1.8 times. This has increased the share of NBFCs in system-level PL portfolio.
Personal loans may also show up in fourth quarter.
The rapid bounce in NBFC’s unseen loan book can cause concern. Earlier, when this happened, RBI had increased the risk weight for loans received by NBFCs from banks. Analysts say that the bounce in unseen loans continues even in the fourth quarter. In February, the RBI had renovated the risk weight for the loans received by NBFCs from banks. This reduced the cost of NBFC funds.
RBI has indicated to reduce risk weight
The RBI has indicated that if it feels that the asset quality has come to the normal level, then it can also bring the risk weight at the earlier level on unseen loans. The question is whether the RBI will regret its decision of softening in microprudential standards? After bringing the risk weight to the earlier level, NBFC has shown an aggressive attitude in giving unseen loans. NBFCs also provide loans to customers whose financial history is weak.
Personal loans of less than 50,000 jap
Analysts have said that once again loans of size less than Rs 50,000 have shown a jump. Earlier, the RBI took strict steps when the pressure was seen in the loan of this size. NBFCs are far ahead in the loan of this category. However, analysts have also said that improvement has come in the profiles of the Berors and the lenders have also become more disciplined. However, the daily rates in personal loans in the first half of FY25 are not good for NBFCs and banks.