Demand for retail loans is expected to grow faster in tier-II cities: Crisil

By | July 5, 2011

According to a recent press report Crisil has said that the demand for retail loans is likely to be extremely strong in tier -II cities due to increased penetration and entry of more players.

a recent report by Crisil titled ‘Retail loan products: Opportunities and risks beyond the metros and mini-metros’ said  that the retail loan markets profitable due to higher yields in spite of their volumes being smaller. The report also includes details of the details current market opportunities and likely growth prospects, across 15 tier-II markets including Bhopal, Coimbatore, Indore and Jaipur. At present, these market together account for 15% of the demand for retail loans in India. Retail loans include home loan, personal loan, car loan, mortgage loan etc.

Mr.Prasad Koparkar head – industry & customized research, Crisil Research said that stronger growth scenario, lesser competition, higher yields and profitability comparable to the larger cities make tier 2 markets an extremely attractive proposition for financiers.

Ajay Srinivasan, head – industry research, Crisil Research has opposed to the perception that all tier-II markets fare poorly in respect of asset quality. He said that in 8 out of the 15 cities studied, the level of NPAs compares favorably with the all-India average for all the five retail loan products.

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About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

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