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The festive season has failed to cheer Non-Banking Finance Companies (NBFCs) as business growth remains muted amid economic slowdown and high interest rates.
In fact, in a bid to control bad loans, many NBFCs were circumspect about certain segments.
“The industry itself did not see the kind of festive season which was seen in 2013. In the industry there has been a de-growth. We have grown in tractors and two-wheelers because of strong tie-ups and strong network,” said Dinanath Dubhashi, managing director and chief executive officer at L&T Finance.
“The industry itself did not see the kind of festive season which was seen in 2013. In the industry there has been a de-growth. We have grown in tractors and two-wheelers because of strong tie-ups and strong network,” said Dinanath Dubhashi, managing director and chief executive officer at L&T Finance.
Bajaj Finserv, on the other hand, went slow on mortgage loans and focused on areas like consumer durables.
“We had 37% growth in AUM in the festive season. Our growth has come more from the SME segment, consumer segment. In consumer segment, the growth was mainly due to consumer durables; two-wheelers sale has been somewhat muted,” said S Sreenivasan, chief financial officer, Bajaj Finserv.
Though the central bank cut interest rates last week and there are expectations of more cuts to come in 2015, loans are yet to turn cheaper for customers. Also, the overall sentiment continue to remain weak.
“We do not see revival going forward. One has to wait and see what happens after the budget. Even if things were to start changing, one has to wait for next two quarters before the benefits start,” said Ramesh Iyer, managing director, Mahindra & Mahindra Financial Services.
