THIRUVANANTHAPURAM: Retail loans have seen steady growth in the state of Kerala over the last two years, according to an analysis by TransUnion CIBIL. Demand for retail loan types like agricultural loan and loan against gold has been the highest in the state.
“Retail loans have grown at 22.76 per cent of Compound Annual Growth Rate (CAGR) in Kerala, slightly higher than aggregate India CAGR of 21.54 percent over the last two years. Loan against gold and agricultural loans form the highest consumed loan types in the state,” informed Harshala Chandorkar, Chief Operating Officer of TransUnion CIBIL.
Loan against gold makes up almost 35 percent of the total retail loans availed in Kerala, closely followed by agricultural loans at around 30 per cent, two wheeler loans at six per cent and consumer durable loans at five per cent. Mortgage loans, auto loans, credit cards and personal loans form under four percent each of the total retail loan uptake in the state.
Speaking on the CIBIL score ranges of the credit-active population in Kerala, Chandorkar said, “Almost 85 percent of the new loans provided in Kerala in the year 2016 were for consumers having CIBIL score of 750 and above. This fact re-emphasizes the importance of maintaining a high CIBIL score and healthy credit history for availing faster and cheaper access to credit opportunities.”
Maintaining a high CIBIL score is even more vital for availing faster and cheaper access to credit. Recently, Bank of Baroda started offering CIBIL score based lending rates to retail mortgage loan seekers, which involves providing a differential rate of interest based on the borrower’s CIBIL score.
Customers with a high CIBIL score and strong financials may get loans which are at least 50-75 basis points cheaper than a customer with a low credit score.