New Delhi: If you are planning to take out a loan through an app or website, you are likely to have a hard time getting a loan. You may have a good credit rating, credit history, good income, and good repayment capacity, but your loan application may not be successful.
Here’s why :
Impact of the liquidity crisis
The financial institutions face a liquidity crisis in the system. “Depending on each lender, they have taken steps to manage the crisis for now. Names that are public include Indiabulls Finance, DHFL, and IIFL. They have stopped lending, especially in the housing segment, as these are large loans for a longer tenure. Some of the biggest lenders have temporarily shut it down, ”said Naveen Kukreja, CEO of Paisabazaar.com.
Everyone is trying to find more capital. For large NBFCs, the lenders are banks and mutual funds. “For FinTech companies, lenders are big NBFCs and they are facing pressures and a downturn. They want to play wait and watch. Banks don’t have liquidity issues, but they are considering lending to NBFCs, ”said Bhavesh Gupta, CEO of Clix Capital.
The most important noise concerns the mismatch between active and passive.
“The problem for real estate finance companies is higher than regular NBFCs. It is very evident that the mutual fund pipe has dried up. The main reason is not the worry, but a combination of factors such as due diligence. A lot of the difference in liquidity has become marginalized since people cut back on disbursements, ”Gupta said.
What it means for you
When liquidity dries up in the system and the demand for credit continues to exist, this impacts disbursements as well as interest rates. “The interest rate on loans has increased over the past month. From a borrower’s perspective, some lenders that existed before September will not be there. The people who are there generally have raised interest rates by 100 to 300 basis points, ”Kukreja said. and NBFC more targeted, their impact will be greater. “There is a considerable slowdown in this segment. However, the credit flow that had diminished in October is coming back,” Gupta said.
Experts say it’s hard to guess given the uncertainty in the macroeconomic environment. However, over the next quarter it is expected to improve, but interest rates will continue to stay higher.
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