see a 20-25% growth in personal loan portfolio this year, but adds it will grow with caution.
“Even though our loan size is very small for this segment — about 4% of our retail portfolio of R24,000 crore — we are closely monitoring this segment and following up with our customers to find the status of their jobs or any job losses,” said Ram Sangapure, the general manager at Central bank of India.
While economic growth has fallen to levels last seen during the global financial crisis, what may help insulate the retail loan business of banks this time around is a change in lending strategy, say experts.
“Banks have been more cautious and there is a good check and balance system which has allowed lenders to be able to choose their customers better,” said Ananda Bhoumik, senior director at ratings agency India Ratings.
RBI data show unsecured personal loans rose 13.3% year-on-year to R1,84,400 crore from R1,62,700 crore at the end of July 2013 and the deployment of credit for credit cards increased 19.1%.