Retail finance is increasingly witnessing defaults, resulting in a number of credit counselling centres being set up in urban areas. Moreover, the number of cases that requires credit counselling has risen after the recent stock market crash.

"The frequency of customers coming to us for counselling has increased after the stock market crash," said Madhukar Joshi, financial counsellor at Disha. According to Joshi, it all began with Bank of India (BoI) setting up ‘Abhay' in Vidharbha to counsel farmers and prevent suicides.

However, GG Joshi, general manager, Bank of Baroda (BoB) feels such centres have begun focusing more on urban areas. "While it is the farmers and rural artisans who need such services, private banks focus more on urban retail where the need for financial discipline has risen in the recent past," he said.

"The default ratio has gone up from 14 per cent to nearly 20 per cent in Gujarat. Even the non-performing assets (NPA) have also increased," said Avtarsingh Madan area collection manager (personal loan), ICICI.