Women borrowing more & more

Their indebtedness growing at 21% since 2014; Women borrowers account for 28% of retail loans ­

Mumbai: Indicating the increasing indebtedness of women, as well as their financial inclusion, 28 per cent of retail borrowers, are women whose dependence on external finance in comparison to men have been growing at 21 per cent since 2014, shows industry data.

According to the data from the largest credit bureau Transunion Cibil released on Monday, women borrowers today number 47 million in the retail credit market and over the past six years, the share of women borrowers has grown to 28 per cent as of September 2020, up from 23 per cent in September 2014, indicating the increasing inclusion of women in the credit market.

This is an annual growth rate of 21 per cent, while the same by male borrowers have grown at 16 per cent during the same period, says the report. In terms of sanctioned loan amount, women borrowers account for Rs 15.1 lakh crore of retail loans today, a growth of 12 per cent annually over the last six years. The report has attributed the same to improved access to economic opportunities leading to better financial inclusion of women.

Transunion Cibil Chief Operating Officer Harshala Chandorkar said the increased participation of women in the labour force, coupled with any government initiatives and policies on improving access to economic opportunities for women have driven this growth. She also said factors like lower stamp duty for women consumers on home purchase in some States along with lenders offering better terms and conditions and lower rate of interest for them have further catalysed this. Another key reason is that women are better at repayment, leading to higher credit scores than their male counterparts, indicating lesser probability of default which makes them better customers for banks and credit institutions.

Insights on credit availed by women show that 45 million new loan accounts were opened by women borrowers during the 12-month period of ending September 2020, marking a 17 per cent annual growth over the past six years ending September 2020. As against this, the number of new loan accounts opened by male borrowers has increased at 16 per cent during the same period. As of Q3 of 2020, there were over 47.5 million active women borrowers with at least one live loan and/or credit card account. In 2014 this was only 14.9 million, Personal loans and consumer durable loans are in top demand for women borrowers with more than 29 million women applied for credit opportunities in 2020, indicating an increase of 26 per cent annual growth over the last six years.

Looked at from a product type, there is a marked preference for personal loans and consumer durable loans by women, with 38 per cent enquiries by women in 2020. Data from 2014, 2015 and 2016 shows that home loans were highest in demand for women. As much as 19 per cent are for home loans too, indicating their increasing ownership in landed assets There is also increased credit consciousness, which is also evident from the fact that women now constitute 12 per cent of self-monitoring consumers, an increase from 10 per cent in 2018. State-level data analysis indicates that the highest number of self-monitoring women consumers are from Maharashtra (18 per cent) followed by Tamil Nadu (11 per cent) and Karnataka (10 per cent).