Retail Credit Card Growth Falls In India As Home Loans Drop By 9%: TransUnion CIBIL Report

India’s retail credit card growth has decreased in the quarter ending June 2024. According to the TransUnion CIBIL Credit Market Indicator Report, this has happened mostly due to a significant slowdown in the home loan segment. A home loan is an amount an individual borrows from a financial institution such as a housing finance company to buy a new or a resale home. Home loans are considered the safest option for the people. The TransUnion CIBIL Credit Market Indicator Report indicates that there is a decline of 9 per cent in the home loan segment, compared to 2023.

Rajesh Kumar, the managing director and the Chief Executive Officer of the TransUnion CIBIL expressed his opinion regarding this change. As per the MD, this has happened due to the financial institutions tightening the credit card supply. This has occurred particularly for consumption-led products. Rajesh said,” Timely regulatory guidance and the relatively high credit-card deposit ratio have led to this moderation.” According to him, the lenders should focus on identifying pockets of deserving consumers across the risk segments to ensure sustainable retail credit card growth.

The decline in the home loans segment has been visible since last year. According to the TransUnion CIBIL report, it is found that the growth rate of home loans was -4 per cent in June 2023. It reached minus 9 per cent in June 2024. Besides the home loans, another segment, Loan Against Property, has also experienced a reduction in growth. The loan against property is the loan people get from the bank against the mortgage of their property. This type of loan comes under the category of secured loan. The LAP has reduced from 13 per cent to 2 per cent, over the same period, i.e. – June 2024.

In addition to this, the auto loans have also witnessed a sharp decline. The growth has witnessed a dip of 10 per cent from 2023 to 2 per cent in 2024. The two-wheeler-loans have also slowed down from 17 per cent in June 2023 to 13 per cent in June. The growth in personal loans has also plunged from 36 per cent in 2023 to 3 per cent in 2024.