Credit-conscious women increase their share of home loans
A report released by the credit bureau on Women’s Day shows that in 2019, women accounted for 23% of consumer loans. That figure fell from 400 basis points (100 basis points = 1 percentage point) to 19% in 2020. Likewise, women’s credit card inquiries fell from 13% to 12% over the course of the year. from the same period. However, when it comes to home loans, women increased their share from 9% to 11% in 2019.
According to Harshala Chandorkar, COO of TU Cibil, this is due to factors such as the reduction in stamp duty for women consumers on a home. purchase in some states, as well as lenders offering better terms and a lower interest rate for female borrowers. “In addition, the fact that women have a higher average Cibil score that of men indicates that women have a better credit history and therefore a lower probability of default, making them better clients for banks and credit institutions. Improved and easier access to economic opportunities has catalyzed the financial inclusion of women in India, ”she added.
TU Cibil (DTC interactive) Vice President and Director Sujata Ahlawat said, “With the improvement in education and employment levels of women across our country, their credit awareness has also increased. . This is corroborated by the fact that we have seen a significant increase in the number of female borrowers who monitor their Cibil score and report. This is a promising indicator of increased financial awareness and literacy among women. This heightened credit awareness is also evident from data which shows that women now constitute 12% of self-check consumers – an increase from 10% in 2018.
Female consumers also have a better credit history compared to men, with the average Cibil score of an Indian woman being 719 – higher than that of an average man at 709 years old. Additionally, 61% of female consumers at TU Cibil’s consumer credit bureau score above 720, while only 56% of male consumers have a score greater than or equal to that number. “Increased credit awareness leads to positive credit behavior as consumers understand the impact of their lending activity on their Cibil score and access to finance,” Ahlawat said.
As women become credit conscious, their overall share of retail loans is also increasing with 4.7 crore in active borrowers. Over the past six years, the share of female borrowers has grown to around 28% in September 2020 – down from around 23% in September 2014, representing a compound annual growth rate (CAGR) of around 16%. In terms of loan amount sanctioned, female borrowers account for Rs 15.1 lakh crore of retail loans, which has grown at a CAGR of 12% over the past six years.