Mortgage Note Size Bounces After Pandemic Slows As Women Achieve High Credit Ratings: Report
The first quarter of 2021 has started off on a promising note, with the average note size for home loans climbing to Rs 28.43 lakh from Rs 27.74 lakh in the previous quarter.
The demand for home loans has increased after the foreclosure and the easing of restrictions, while the average amount of personal loans has plummeted, according to a recent report from BankBazaar.
The first quarter of 2021 has started off on a promising note, with the average note size for home loans climbing to Rs 28.43 lakh from Rs 27.74 lakh in the previous quarter. It dropped with Wave 2, Q2, but since Q3, ticket sizes have picked up.
The fourth edition of BankBazaar Moneymood 2022 highlights the credit buying trends in India in 2021 and presents the outlook for 2022.
According to the report, nearly 70% of BankBazaar customers have a credit score of over 700 points, with 36% having a rating of 800 points or more.
According to the report, women are more aware of their financial habits than men, which is reflected in their credit scores. Over 72% of women scored 700 or more, compared to 66% of men. Even in the high scoring category, 40% of women reported scores of 800+, compared to 35.6% of men. Overall, employees have better scores than the self-employed. Here, 69.2% of employees have a score of 700+ against 61.25 self-employed. Only 27.5% of the self-employed have scores above 800 against 40% of employees.
Commenting in the same vein, Adhil Shetty, CEO of BankBazaar.com, said: “In recent years there has been greater transparency on how interest rates on credit products are set and the role of credit score in the whole process. Therefore, people understand the need for a good credit rating and actively follow them. Women, in particular, are more successful in maintaining a good credit rating, thereby improving their chances of accessing credit. Nonetheless, there are gaps that need to be filled.
“While 67% of people who check their credit score on BankBazaar have a score of 700+, only 36% of them have a score of 800+ – a score that would get you the best rate out of n ‘ any credit product from most financial institutions. . It is for this reason that our first co-branded credit card has regular credit reports as one of its USP, ”he added.
Rebound in demand for home loans
2021 was the year of the turnaround after the mortgage pandemic. Despite the setbacks of the second wave of the pandemic, the year has been a time of growth. The first quarter of 2021 has started off on a promising note, with the average ticket size for home loans climbing to Rs.28.43L from Rs.27.74L in the previous quarter, according to data from BankBazaar. It dropped with Wave 2, Q2, but since Q3, ticket sizes have picked up.
Personal loans are declining
The average note size for personal loans fell for the fourth year in a row from Rs 1.92 lakh to Rs 1.86 lakh. The average ticket size for women at Rs 1.87 lakh was slightly larger than for men at Rs 1.86 lakh. The average size of non-metro loan tickets has dropped sharply to Rs 1.73 lakh this year, from Rs 2.19 lakh last year. Subways, on the other hand, have soared to an average loan ticket size of Rs 1.91 lakh compared to last year’s average of Rs 1.87 lakh, overtaking non-metros. The easing of the average note size for loans follows industry trends following the tightening of unsecured credit policies as well as the increase in small and very small note loans such as “buy now, pay” loans. later “.
“The constraints of the pandemic have increased the importance of credit cards as a first line of credit as well as as the easiest method of payment. Coupled with easy accessibility through contactless application processes through Digital KYC, demand for credit cards has rebounded strongly and continues to increase. Over the coming year, we expect a similar acceleration in the lending segments as new mounts return to pre-COVID levels on Digital KYC, ”said Pankaj Bansal, Chief Commercial Officer of BankBazaar.com.
Fuel cards with a vengeance
Credit cards have grown in popularity by leaps and bounds. Two very interesting trends have emerged. This first was the nearly 10-fold jump in demand for fuel cards. Soaring fuel prices are driving consumers to look for any option to lower their fuel prices, and the rewards and perks on fuel cards allow them to do just that.
The share of fuel cards rose to 13.1% of all cards, against 4.95% last year. As fuel prices still show no signs of going down and offices and schools are slowly opening up, demand for fuel cards is expected to remain high for the foreseeable future.
As home shopping took center stage, rewards cards rebounded strongly to grow more than 100% from last year. With personalized rewards, cash back rewards, and deals on online and offline purchases of essentials, luxury items, lifestyle and entertainment expenses, acquisition cards look more appealing than ever, and demand is also expected to increase in the coming year.
The second very interesting trend in credit cards has been the number of women opting for credit cards. The percentage of female credit card customers has increased by almost 50%, from 8.41% last year to 12% this year. While the number of women opting for credit cards has increased across the board, the change is most noticeable among women under 25. The under-25 age group has been the most aggressive in credit card adoption and has risen sharply by 175% compared to all other cohorts, which have increased by around 100%.
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