Moneymood 2024
We’re pleased to bring to you the sixth edition of BankBazaar Moneymood.
This report carries a summary of retail credit trends in the year gone by and our forecast for2024. Our focus is on credit cards, personal loans, and home loans.
Retail lending saw another year of tremendous growth, albeit slightly slower than 2022, as AUMs grew 18% to ₹4.51 trillion. It was another year of high inflation and interest rates, which nevertheless did little to deter India’s demand for credit.
Some segments continued to grow faster than others. Home finance, 47% of the retail pie, grew 14% to ₹2.71 trillion, while vehicle loans capped another year of 20% growth to ₹5.55trillion. India chased its aspirations undeterred by global economic uncertainties and geopolitical volatility.
This was the year of small loans. Personal loans surpassed the ₹10 trillion mark. Credit card dues grew to ₹2.4 trillion powered by 94million cards as the momentous 100 million milestone appears on the horizon at the dawn of a new year.
Elevated interest rates remained a sore point this year. The Reserve Bank of India balanced its deflation program with India’s growth needs beautifully by pausing the repo rate early in
2023. But a rate cut eluded us and remains one of the big moments to look out for in 2024.
One of the key developments in 2023 was the RBI applying the brakes on unsecured and small-ticket loans. This has been seen as the central bank proactively managing the proliferation of small loans before asset quality worsens in this category.
Therefore, early in 2024, we’ll see the effects of this capital tightening. Credit will continue to be easily accessible for the prime borrower with a credit score over 750, a stable income, and a track record for timely payments. But for the sub-prime, borrowing may be trickier as banks adjust to the new risk weights.
We close 2023 on a note of cautious optimism. The new year holds immense promise—for India, and for us at BankBazaar.
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