Surabhi

Even as the Reserve Bank of India announced extension of the moratorium on term loans by another three months till August 31, industry data reveal that auto and home loans are the major segments where retail borrowers have been availing the facility.

Credit card loans

Data with leading banks and non-banking finance companies show that retail borrowers and small businesses have also been availing the facility for farm and consumer loans as well as outstanding credit card loans.

Data with Bajaj Finance revealed that as much as 70 per cent of its assets under management in the auto finance business was under moratorium as on April 30. This was followed by 30 per cent each of the AUM under rural business to business and SME business under moratorium.

Significantly, its consumer B2C business, which has the largest AUM of ₹30,500 crore, had 29 per cent of the funds under moratorium.

L&T Financial Services reported that 32 per cent of its borrowers who had taken consumer loans had availed the moratorium as on March 31, followed by 31 per cent of borrowers who had taken a farm loan. As much as 29 per cent of the borrowers who had taken a two-wheeler loan also availed the moratorium.

Ramesh Iyer, Vice-Chairman and Managing Director of Mahindra and Mahindra Financial Services Ltd, said that other than farm and local small traders, about 75 per cent of its total customers had taken the moratorium.

“The moratorium has not been allowed to certain delinquent customers. It was available for customers in 0, 1 and 2 buckets, of which, about 70 per cent to 75 per cent have taken the moratorium,” he told BusinessLine.

Cash flows

Bankers have reported that many retail customers opted for the moratorium out of caution to conserve cash flows in segments such as housing loan and even credit cards.

Published on May 25, 2020

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