Mumbai: RBI’s measures to curb bank finances in some segments of NBFCs appear to have slowed down growth for finance companies.
Loans sanctioned by NBFCs fell from Rs 4.47 lakh crore in Q2 FY23 to Rs 4.28 lakh crore in Q3 FY24 — a decline of 4.2% quarter-on-quarter. Compared to the year-ago period, loans fell 5.8%.
The decrease was largely due to long-term loans, which fell 40% or Rs 10,365 crore to Rs 15,500 crore. Education loan sanctions, which are seasonal, saw a 63% decline QoQ — to Rs 4,553 crore from Rs 12,454 crore in the preceding quarter. The third biggest drop was in housing loans, where sanctions fell 13% over the previous quarter to Rs 47,199 crore.
Other segments which saw a QoQ decline were loans under govt’s credit guarantee scheme, hire purchase loans, loans against shares, bill discounting, equipment financing, and auto loans. On the other hand, bank guarantees, two-wheeler and consumer loans grew QoQ.
Data provided by the Finance Industry Development Council and credit bureau CRIF High Mark showed that consumption loans such as two-wheeler loans, consumer loans, gold loans, personal loans, and education loans saw good growth year-on-year. Home loans, however, showed a marginal decline of 2%.
Loan data from July 2023 onwards pertaining to HDFC — a finance company — will be included with HDFC Bank following their merger. While the YoY numbers do not take into account the merger, QoQ numbers for both quarters are from after the merger.