The strict lockdown in the first quarter of the current fiscal resulted in creating pent-up demand for home and auto loans, which is finding expression now.
According to TransUnionCibil data, home loan inquiry volumes in July and August have recovered to exceed last year’s levels but are still below January and February 2020 levels.
The revival is being led by public sector banks, which were the first to recommence operations. Personal loan inquiries from public sector banks are 118 pc of last year and 102 pc of the pre-COVID months in 2020.
Private banks are still doing only three-fourths of last year while NBFCs and finance companies are seeing half as many applications as the pre-COVID months.
TransUnionCibil data shows that home loan inquiries have rebounded the most and are 112 percent of what was seen in July-August 2019 but only 92 percent of January-February 2020 (pre-COVID).
Auto loans are 88 percent of last year’s levels and 84 pc of the pre-COVID level while demand for loans against property is at 90 pc of last year but 72 pc of pre-COVID.
Lenders send a query to the credit bureau whenever a borrower seeks to know his loan eligibility. Although credit inquiries may not match loan disbursements, they are a good indicator of demand in the market.