Cash Is King: Report Says Non-Metro Borrowers Outpacing Metro Peers; Millennials, Women Major Credit Drivers

The number of people borrowing money in India has risen, with residents of non-metro cities borrowing greater sums on an average than metro dwellers, says a new report called ‘Moneymood 2019 — How India Will Bank This Year’ by Bankbazaar, reports Mint. For metros, the average loan ticket size in 2018 was Rs 2.55 lakh and in non-metros, it was Rs 2.80 lakh.

“My hypothesis is that in the metros, people have access to both personal loans and credit cards. In non-metro areas, people are still not able to get a credit card very easily, and are restricted to personal loans for their credit requirements, leading to a spike in the average ticket size," said chief executive officer of Bankbazaar Adhil Shetty.

Bengaluru outperformed all other metros to have the highest ticket size in the category at a whopping Rs 47.23 lakh, while Vapi had the highest ticket size in the non-metro category.

Interestingly, the average home loan ticket size was Rs 27.57 lakh in cases where there was a female primary applicant, higher than the average for men at Rs 22.97 lakh.

CEO of MyLoanCare.in, an internet-based lending portal, attributed this to some states offering incentives such as lower stamp duties in case property is purchased in the name of a woman.

The report has predicted a growth in home sales in 2019 by 16 per cent, boosted by demand for affordable housing and more first-time buyers being attracted by government schemes such as the Pradhan Mantri Aawaz Yojana (PMAY).

The Under-25 demographic has made its mark in the credit card segment, particularly in non-metro cities. This age cohort is especially attracted by lifestyle credit cards which are designed for lifestyle-linked expenses such as apparel, entertainment, dining, etc. The number of applicants for lifestyle credit cards has risen by 64.5 per cent year-on-year in non-metros.