The devil in retail: Stress seen in credit cards, auto, and home loans

Banks had grown their retail books in a big way in recent times given the lacklustre demand for corporate credit

Business Standard
Last Updated at January 28, 2020 21:25 IST

banks, loans, credit, private banks, public sector banks, PSU banks, loan write-off, npa, bad loans, Non performing assets, asset

Delinquencies in banks’ retail portfolio is inching up. This comes even as the share of retail credit to GDP increased to 12 per cent in HIFY20 — a full percentage over the 11 per cent seen in FY08. The increase in stress was seen in credit cards, auto, and even in home loans. Banks had grown their retail books in a big way in recent times given the lacklustre demand for corporate credit. The Reserve Bank of India’s Financial Stability Reports of recent times had forewarned about the pain lurking in the retail segments. The central bank’s Report on the Trend and Progress of Banking (2018-19) observes that banks’ diversification strategy (into retail), while helpful as a risk mitigation tool, “has its own limitations: the slowdown in consumption and overall economic growth may affect the demand for and the quality of retail loans”.

TO READ THE FULL STORY, SUBSCRIBE NOW NOW AT JUST RS 249 A MONTH.

MONTHLY

₹ 249

Select

ANNUAL

₹ 1799

Select

Best Offer

SMART ANNUAL

₹ 1499

₹ 1799

Opt for auto renewal and save Rs 300

Select

What you get on Business Standard Premium?

Unlock 30+ premium stories daily hand-picked by our editors, across devices on browser and app.
Full access to our intuitive epaper - clip, save, share articles from any device; newspaper archives from 2006.
Curated newsletters on markets, personal finance, policy & politics, start-ups, technology, and more.
Pick your 5 favourite companies, get a daily email with all news updates on them.
26 years of website archives.
Preferential invites to Business Standard events.