Personal credit card debt as a portion for the total is small, however it is high priced credit, and standard is normally an indicator that individual funds come in difficulty.
I t will be the canary when you look at the coalmine: SBI Cards and Payments has reported a trebling of its bad loan portion in just one single quarter. The bad loan ratio would have jumped more than five-fold, from 1.4 per cent to 7.5 per cent if it had not been for the moratorium order preventing the full recognition of delinquency. Credit debt as a share regarding the total is small, however it is high priced credit and standard is generally an indication that individual funds have been in difficulty. Therefore performs this development have actually a bigger significance?
The government-owned banks had mimicked some private banks and switched their focus from industrial credit to retail and service sector loans, which now account for over half the total loan book in the last couple of years. This had followed the realisation that commercial loans (especially to big businesses) frequently ran into difficulty. (mehr …)