Mumbai: Half of the population of state workers by 400 million people is active credit, having at least one loan or credit card, a report by credit information company (CIC) said on Tuesday.
Credit institutions are quickly close to the level of saturation in new customers because more than half the borrower comes from the existing bank customer base, the report by Transunion Cibil said.
The overall Indian work population is estimated to reach 400.7 million in January 2021, while the retail credit market has 200 million unique individuals active, he said.
It should be noted that long, there is concern about the borrower which ends up on the trap of money lenders who do not struggle that are not regulated and efforts have been installed to deepen access to finance.
Over the past decade, the reversal faced on the company’s loan side made the bank prefer retail credit but worries were being appointed for segment resilience after a pandemic.
Data from CIC said there was a market that could be addressed by 400 million people between 18-33 years in rural and semi-urban areas, and showed that credit penetration in this segment was only 8 percent.
In the new universe to credit (NTC), there are higher preferences for products including personal loans and long-lasting consumers in segments under 30 years and who live outside the Tier-I cities, he said.
The composition of women continued to be much lower in the NTC segment, he said, indicating that the composition of women’s borrowers was only 15 percent in a car loan, 31 percent in home loans, 22 percent in private loans and 25 percent in long-lasting loans consumers.
CIC data also shows that NTC consumers show higher loyalty to credit institutions that have given them their first credit opportunity, the report said.
The borrower also tends to prioritize payments at the first credit facility during the second time of financial stress, he said.
“Identifying NTC consumers that emerge throughout the segment and allow access to financial opportunities for them it is very important to encourage economic revival and sustainable financial inclusion in our country,” said CIC executive director and the chief executive of Rajesh Kumar.
He also added that lenders can assess credit risk associated with NTC customers also with CIC products to increase the time of completion and reduce acquisition costs.
The ‘CreditVision NTC’ assessment model is based on algorithms that use application information and borrowers’ investigations to help assess their feasibility better.