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73 Percent of Credit Managers Likely to Change Lending Strategies for Unsecured Portfolio Post Pandemic-PwC: Equifax Survey and Report

Business Wire India 

36% of credit managers looking to adopt alternative data in addition to bureau data for better underwriting.
50% of credit managers surveyed have accelerated the use of digital tools for customer acquisition.

Equifax Inc. (NYSE:EFX), a data, analytics, and technology company, and PwC India collaborated to launch a first-of-its-kind report on the retail lending landscape in India. The first edition of the report highlighted the impact of COVID-19 and resulting disruption on sourcing and delinquency trends by loan type, lender type, and geography.

Launching the report, Shri Rajkiran Rai G, Managing Director and CEO of Union Bank of India, the leading public sector bank, said, “As practitioners, the financial services industry looks forward to understanding the macro lending trends to adapt its strategy and risk policies accordingly. This has become even more important due to COVID-related impacts in 2020. PwC and Equifax have brought smart data and analysis along with industry insights in this thought leadership report covering the retail lending industry trends.”
To read the report, click at: https://www.pwc.in/assets/pdfs/consulting/financial-services/mapping-the-indian-retail-lending-landscape.pdf or https://www.equifax.co.in/business

Sreedhar Vegesna, Partner and Financial Services Leader, PwC India, said, “The Indian Retail Industry, with its technology-driven differentiation, is evolving at a dynamic pace. However, lenders are facing unprecedented challenges across both sourcing and collections owing to the COVID-19 pandemic. PwC has entered into a unique partnership with Equifax to present key sector insights and strategic inputs to lenders through its report in the Retail Lending landscape. This is a first in a series of publications which aims to empower industry players to take best-fit measures for building a robust lending portfolio and ensuring business growth.”

On the occasion of the launch of the report, Asim Parashar, Partner Financial Services, PwC said, “With the first edition of the Report on the Indian Retail Lending landscape, PwC and Equifax kick-start a unique series of publications that uncover retail lending trends across multiple lenses including geographies, sectors, and products. This report presents an opportunity for readers to revisit the key learnings from the brief sector revival witnessed as the first COVID wave subsided and leverage the same to grapple industry challenges. Currently, industry leaders have chosen product, service, and distribution channel innovation enabled by accelerated digital adoption as the preferred business growth strategy. In the future editions, PwC and Equifax will aim to explore the key strategic shifts in the wake of the second COVID wave and the industry landscape thereafter.”
KM Nanaiah, Managing Director, Equifax Credit Information Services Pvt. Ltd. and Country Leader, Equifax India, and MEA, said, “Over the years, Equifax, as the leading credit bureau in the country, has worked with the Indian financial services industry to help maintain high levels of underwriting standards. Now, with its partnership with PwC, Equifax brings a report to provide insights on trends in Indian retail lending industry – from disbursements to delinquencies, from top growing states to top loan categories, and impact of COVID-19 thereof. This report will act as a lighthouse, helping the financial services industry and policymakers navigate through crests and troughs of lending cycle, thus further promoting responsible lending in these times.”
Key report highlights include:

The demand for high ticket-sized loans decreased significantly post-pandemic, with large ticket-sized loans (>INR 75 lacs) showing sharpest decline of 80%
The top five states (Maharashtra, Uttar Pradesh, Tamil Nadu, Andhra Pradesh, and Karnataka) alone contributed to almost 50% of 90+dpd delinquent accounts
73% of credit managers in the PwC / Equifax survey said they are exploring change in lending strategy for their unsecured loan portfolio
Proactive collection strategy followed by Enriching contactability of borrowers were the top two measures highlighted by credit managers to manage emerging risks

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