The Reserve Bank of India (RBI) is monitoring loans with a ticket size of up to ₹50,000 on the books of banks and fintech lenders. A majority of consumers in this segment services three "live" loans, and it is suspected this could be an indication of evergreening with the possibility of diversion into capital markets.
The scrutiny should be seen in the context of the RBI in November asking regulated entities (RES) to review their exposure limits for consumer credit and put in place board-approved limits for various sub-segments, specifically unsecured consumer credit exposures, by February 29, 2024.
While no sizing study has been done on this segment of loans, data from the Fintech Association for Consumer Empowerment shows runaway growth in such offerings given by new-age fintech lenders.
This story is from the July 29, 2024 edition of Business Standard.
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This story is from the July 29, 2024 edition of Business Standard.
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