Loan sanctions plunge 28% in June quarter

Data compiled by credit bureau CRIF High Mark has indicated that credit disbursals by non-banking finance companies slid by 28% to Rs 1.79 lakh crore at the end of June versus Rs 2.49 lakh crore at the end of March.  This 30% yoy fall happened almost a year after the liquidity squeeze that ensued due to the unexpected default by Infrastructure Leasing & Financial Services (IL&FS). 

 Housing, property and auto loan segments were the worst affected. According to the findings, housing loan sanctions dropped by 30% to Rs 45,000 crore against Rs 64,000 crore in March while loans to developers dipped by nearly 40% to Rs 13,730 crore versus Rs 23,000 crore QoQ. Auto- and two-wheeler loans decreased by 17% to Rs 26,000 crore in the June quarter. 

 “The hope is pinned on the festive season to bring some relief to the sector because the first quarter is a slow credit period. Also, several measures were announced by the government and the RBI in the July-August period which may have some positive impact as well in the coming quarters,” said Parijat Garg, senior Vice President, CRIF.