This Diwali, lifestyle spends have seen the highest growth in loan applications among metro cities where in loans for gadgets and electronics have seen a spike of 103 per cent in 2019 as compared to 2018; while there has been a rise of 48 per cent for personal loan applications for home renovation or improvement; loans for funding weddings saw an increase of 46 per cent. All these can be attributed to the fact that Diwali is considered to be an auspicious occasion for shopping, gifting as well as home renovation as it is a symbol of peace and prosperity.
A staggering 95 per cent increase was observed in loan applications for funding of business, where in Mumbai witnessed the highest growth followed by NCR and Bangalore with 137 per cent, 113 per cent and 80 per cent increase respectively. Tier 2 cities also saw a 43 per cent increase in the applications for travel loans, followed by a spike of 42 per cent in debt consolidation in 2019 as compared to 2018.
These were some of the significant findings of a new survey on loan trends among Indian millennials conducted by IndiaLends — a new-age digital lending platform around the festive season.
The study was conducted among Indian millennials across six major metro cities — Mumbai, NCR, Bangalore, Hyderabad, Chennai, and Kolkata as well as six Tier 2 cities including Jaipur, Ahmedabad, Lucknow, Indore, Chandigarh and Vizag. In all, 12,391 respondents were evaluated for their loan requirements in eight main categories, namely Wedding, Funding Business, Education, Travel, Debt Consolidation, Home Renovation, Gadgets or Electronics and Unexpected Expenses.
Some of the other findings were:
- There has been a 50 per cent rise in loan applications among women in 2019 as compared to 2018 in Bangalore whereas 48 per cent women in Mumbai have applied for loans in 2019 as compared to 2018
- The loan ticket size range was between Rs 17,000 to Rs 15,00,000 for funding businesses; while home improvement cost varied between Rs 40,000 to Rs 28,00,000.
- The wedding loan ticket size was in the range of Rs 20,000 to Rs 29, 00,000; while loan for unexpected expenses like medical emergencies was in the range of Rs 38,000 to Rs 34,00,000.
- NCR saw the highest change in loan applications for weddings being 98 per cent as compared to 2018; whereas Bangalore recorded the highest change in applications in travel loans being 64 per cent
- Mumbai saw a change of 105 per cent in loan applications for home renovations in 2019 as compared to 2018 while NCR recorded the highest change in loan applications for gadgets and electronics being 286 per cent.
IndiaLends Founder and CEO Gaurav Chopra said, “The survey was an attempt to understand and assess how millennials spend during the festive period of Diwali. Millennials of today are a true embodiment of the philosophy ‘Work hard and Play hard’, and this was further substantiated through the survey findings. Giving impetus to the same, we saw a major increase in loan applications for gadgets and electronics, travel and weddings. Millennials from Tier 2 cities aren’t much different from their metro counterparts.
Moreover, an increase in the applications for business purpose and debt consolidation proves how financially conscious and aware they have become. We have been constantly working towards helping our customers have healthy credit behaviour and we can say that our customers are now financially more prudent and are taking better financial decisions. The findings of the survey have helped us recognize that while we have made significant progress in that direction, there is still more work to do.”