There is a loan available for almost everything sold under the sun – from gadgets to clothes to the food you buy for your pet. Add to that the fact that it only takes a few taps on your phone and less than 10 minutes to get the money to your bank. It is therefore not surprising that the demand for personal loans continues to increase year on year while the size of loans continues to decrease, according to a report published by BankBazaar.
The average ticket size for personal loans reduced for the fourth consecutive year by ₹1.92 lakh in 2020 to Rs1.86 lakh this year, the fourth edition of BankBazaar Moneymood 2022 revealed. this year of ₹2.19 lakh last year. In comparison, the average size of loans taken out in metropolitan cities increased from Rs1.87 lakh to Rs1.91 lakh for the same period.
This trend can be attributed to the tightening of unsecured credit policies as well as the increase in small and very small note lending, BankBazaar said.
“The constraints of the pandemic have heightened the importance of credit cards as the first line of credit as well as the simplest form of payment. Coupled with easy accessibility through contactless application processes through digital KYC, demand for credit cards has rebounded strongly and continues to rise,” said Pankaj Bansal, Chief Commercial Officer of BankBazaar.com.
“Over the coming year, we expect to see a similar acceleration in the lending segments as new originations return to pre-COVID levels thanks to Digital KYC.”
The report sheds light on the current year’s credit buying trends and the outlook for 2022.
The report showed a rebound in demand for home loans in the last quarter of the current calendar year. “2021 was the year of the turnaround after the pandemic for real estate loans. Despite the reversals of the second wave of the pandemic, the year was a period of growth,” he said.
The average amount of the mortgage ticket has increased to ₹28.43 lakh in the first quarter of 2021 from ₹27.74 lakh in the previous quarter. This dropped in the second quarter with the onset of the second wave, however, from the third quarter the ticket size increased again, according to the report.
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