India Retail Credit Market Health Stronger Than Pre-Pandemic Levels

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India, October 20, 2022 – TransUnion CIBIL today released findings from the June edition of its Credit Market Indicator (CMI) report, which showed that credit demand in the second quarter of 2022 exceeded pre-pandemic levels with a corresponding increase in new accounts opened. This reflects continued robust growth in the Indian credit environment, despite global economic headwinds.

The CMI provides India’s credit industry with a reliable and contemporary benchmark of retail lending health, and reached a level of 99 in June 2022 – the same level seen in December 2019, before the COVID-19 pandemic hit the Indian economy.

The CMI* is a comprehensive measure of data elements that are summarized monthly to analyze changes in credit market health, and are categorized under four pillars: demand, supply, consumer behavior, and performance. These factors are combined into a single, comprehensive indicator, and pillars can also be viewed in more detail individually.

The latest CMI of 99 is up four points from the previous quarterly measure in March 2022, and a significant 21 points up from its low of 78 in January 2021 at the height of the COVID-19 surge. This is supported by significantly improved credit health in the top 12 states in India, with the CMI value in Karnataka and Kerala both increasing by 16 points, and the CMI value in Tamil Nadu, Andhra Pradesh, and Rajasthan all increasing by 14 points over the preceding 12 months.

“Supported by progressive government policies and active implementation by ecosystem players, momentum has returned to India’s credit market. Retail credit portfolio balances continue to show strong recovery across products,with homeloan balances growing by 15%, auto loans by 13%, consumer durable loans by 61%, credit card by 32%, and personal loan balances by 29%, year-over-year to June 2022,” informed Rajesh Kumar, Managing Director and CEO of TransUnion CIBIL.

“The Indian credit environment has shown signs of strong recovery, with improvement in credit activity as well as positive lender sentiment,” continued Kumar. “Credit performance has consistently improved year-over-year, with generally lower delinquency levels. The time is ripe for lenders to identify many credit eligible consumers across India’s geography and reach them to provide easy and quick access to credit while delivering a positive experience.”

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