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Tuesday, December 02, 2025 | 03:27 AM ISTहिंदी में पढें
New borrowers face credit squeeze, turn to secured loans and credit cards
A rise in defaults, particularly in small-ticket unsecured personal loans, prompted the Reserve Bank of India (RBI) to tighten lending norms
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Banks and NBFCs are focusing on existing, credit-tested borrowers over NTC applicants in the current environment.
Retail credit growth moderated in the quarter ended December 2024. The impact of this slowdown was especially felt by new-to-credit (NTC) customers, according to a recent report by TransUnion CIBIL.
Lenders turn cautious
A rise in defaults, particularly in small-ticket unsecured personal loans, prompted the Reserve Bank of India (RBI) to tighten lending norms. “There was an uptick in defaults among borrowers with little or no credit history,” says Adhil Shetty, chief executive officer (CEO), BankBazaar.
The RBI increased risk weights on personal loans, credit card exposures, and lending to non-banking financial companies (NBFCs). “Banks became cautious and this led
