There has been an increase in demand for consumption-led credit products like credit cards and personal loans, a report by TransUnion CIBIL showed on Wednesday.
Across product categories, inquiry volumes for personal loans rose 50% year-on-year (YoY), while inquiry volumes for credit cards rose 77% YoY in the December quarter. For loan against property, these rose 29% YoY.
Inquiry volumes in the 18-30 age group rose to 43% of overall inquiries in the December quarter, from 40% a year ago. Inquiry volumes in the rural segment rose to 22% of overall volumes from 21% a year ago.
Loan originations in the two-wheeler segment rose YoY both in terms of volume and value. Originations in terms of value rose 40% YoY. In terms of volume, they rose 23% YoY. Approval rates in the two-wheeler loan segment were at 45%.
On the other hand, loan originations in the home loan segment fell 2% YoY in terms of value and 6% in terms of volume. However, approval rates in the segment remained strong at 41%.
The growth in loans has been driven by non-banking financial companies and financial technology companies, the report said. In fact, the demand for these categories of loans has remained strong even in 2023.
As of February, ‘other personal loans’ rose 25.8% YoY. Credit card outstanding also rose 29.2% YoY. Loan approval rates in the new-to-credit segment fell to 24% as on December 31, from 32% a year ago.