Representative of growing aspirations, a greater number of Indians are now borrowing to purchase cars and the loan ticket sizes are also steadily going up, a report said today. The outstanding loan portfolio for passenger cars grew 30 per cent over the year to Rs 3.59 lakh crore as of September 2017, domestic rating agency Crif Highmark said, even as concerns continue to be voiced over the quality of urban infrastructure and its ability to support the vehicles. The average loan size has grown by over 20 per cent in the last three years to Rs 5.5 lakh, up from Rs 4.5 lakh three years ago, it said. In financial year 2016-17, 31 lakh cars got financed and 17 lakh cars would be financed in the six months to September 2017 alone, it said. The Rs 5-10 lakh portfolio is becoming the most popular ticket size with 41 per cent of the loan portfolio falling in this bracket, it said, adding that earlier, the Rs 2-5 lakh bracket used to be popular. Loans in the Rs 2-5 lakh bracket have come down to 40 per cent now from the 55 per cent in financial year 2011-12, the agency said. In the last eight quarters, the disbursals had touched a high of 8.24 lakh in October-December 2016 period, and the same touched 7.99 lakh for the July-September quarter this year.
However, from the perspective of amount disbursed, the total value was higher despite fewer number of loans, it said, adding that Rs 42,034 crore git disbursed in the October-December 2016 period, which went up to Rs 44,110 crore in the July-September 2017 period. When looked at from a geographical spread perspective, Maharashtra leads the way as the most active car loan market by the amount disbursed, while Telangana leads on the average ticket size. Maharashtra had 3.77 lakh loans with an average ticket size of Rs 5.38 lakh sold in FY17, while the same for Telangana was 1.29 lakh loans with an average ticket of Rs 6.04 lakh. On the asset quality, the financiers do not have a lot to complain the dud loan proportions have improved to 3.7 per cent as of September 2017 as against 4 per cent in the year-ago period. The non-bank lenders have a higher proportion of non-performing assets than the private sector lenders or even the state-run lenders which are more prone to troubles on this front, it said. Loans overdue for over 90 days but less than 360 days for the non-bank lenders stands at 3.7 per cent as against the 1.9 per cent average for the industry, it said.