NBFC loan sanctions drop by ₹19,000 crore in Q3; which segments were major laggards?
Upstox
2 min read • Updated: April 4, 2024, 1:49 PM
Summary
The cumulative value of loans sanctioned by NBFCs in the October-December 2023 period stood at ₹4.47 crore, down 4.2% as against loans amounting to ₹4.28 crore sanctioned in the June-September 2023 period, reports said, citing the data provided by an industry body. Education loans segment witnessed the sharpest decline on a sequential basis, followed by long-term loans and home loans.
The loans sanctioned by non-banking financial companies (NBFCs) dropped by 4.2% or nearly ₹19,000 crore in the third quarter of fiscal year 2023-24 (Q3 FY24), as compared to the preceding quarter, as per the data shared by industry body Finance Industry Development Council (FIDC).
The cumulative value of loans sanctioned by NBFCs in the October-December 2023 period stood at ₹4.47 crore, as against loans amounting to ₹4.28 crore sanctioned in Q2 FY24, reports said, citing the FIDC data.
Which segments were major laggards on QoQ basis?
- Education loans: This segment registered the sharpest decline on quarter-on-quarter (QoQ) basis, with loans amounting to ₹4,553 crore sanctioned in the October-December 2023 period, down 63% as compared to loans of ₹12,454 crore sanctioned between June-September 2023, the FIDC data showed according to a Times of India report.
- Long-term loans: The sanctions of long-term loans fell by 40% QoQ, from ₹15,500 crore in Q2 FY24 to ₹10,365 crore in Q3 FY24, the newspaper further reported.
- Housing loans: This segment recorded the third sharpest plunge, as loans amounting to ₹47,199 crore were sanctioned in the December 2023 quarter, lower by 13% as compared to the preceding quarter, as per the report.
Some of the other segments that reportedly witnessed a decline include loans issued for equipment financing, fire purchase loans, auto loans, and loans against shares.
Year-on-year (YoY), however, the value of loans sanctioned increased by 6% in Q3 FY24, Business Standard reported, citing the FIDC data. The segments that recorded YoY growth include personal loans, two-wheeler loans, consumer loans, education loans and gold loans. However, home loan sanctions declined by 2% as compared to Q3 FY23.
The FIDC data also pointed towards a sharper increase in loans sanctioned in rural areas as compared to urban regions. On a YoY basis, rural sanctions increased by 14%, whereas urban sanctions increased by only 2%.