For the last two years – during 2020 and 2021 – Covid-19 played a spoilsport – dampening the festive mood of people by either locking them up indoors or by making them avoid crowded places. With the pandemic fear gone – or at least subdued – people are in no mood to miss the euphoria during the upcoming festive seasons of Dussehra and Diwali this year.
With post-pandemic life coming back to normalcy, a more cavalier attitude toward celebrations, and a happy spending spirit in the air during this festive period, digital lending players like CASHe, Niro and peer-to-peer lending platforms like LenDenClub are anticipating a three-fold rise in demand in the upcoming months. People – especially millennials – are availing small ticket size loans to meet their diverse purchasing demands.
The increase in demand can be attributed to a variety of factors – like loans for consumer goods have escalated, thanks to a multitude of price and sale offerings being extended by retail and e-commerce platforms around the festive season. Therefore, a lot of people are borrowing as an advance salary to meet their festive needs
Due to raining offers and launches on online marketplaces ahead of festivals, millennials seem to be on a buying spree by borrowing money from various lenders online!
New digital lending platforms are reporting a surge in demand for small-ticket loans from millennials in the run-up to the festivals. P2P lending platform LenDenClub has witnessed a 97 per cent increase in demand for small-ticket loans, out of which the number of travel loans disbursed has increased by more than 4 times in the same period and it is expecting a three-fold rise in demand in the next quarter. The average ticket size of our loan bracket typically ranges between Rs 12,000 and Rs 15,000.
Similarly, digital lender, CASHe is also seeing pent-up demand for loans with a 35 -40 per cent monthly increase in applications. The average ticket size loans normally hover in the range of Rs 25,000 to Rs 40,000. In comparison to last year, monthly loan applications have increased by almost 400 per cent. The rise in credit line is more than 7 times from last year.
The following table displays the comparison of loans disbursed between May to August in 2021 and during the same period in 2022:
“We are seeing increasing demand as we inch closer to the festive season. Our interested rates have jumped up by 30 per cent and we are seeing a 50 per cent increase in people completing their journeys unassisted. We expect these numbers to improve further in the coming weeks,” said Sankalp Mathur, Co-founder & CRO, Niro.