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Half Of Working Population In India Is Under Debt : CIC Report

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A Credit Information Company (CIC) report said that nearly half of the country’s 400 million working population are indebted. They have taken at least one loan or have a credit card. According to the TransUnion CIBIL report, lending institutions are fast approaching the saturation level for new customers.

In a decade, banks gave priority to retail loans

The report further said that according to an estimate, as of January 2021, the total working population of India was 40.07 million. Meanwhile in the retail credit market, 200 million people have taken loans in some form or the other. Significantly, in the last decade, banks have given priority to retail lending. But after the pandemic, there are concerns about the growth of this segment.

According to CIC data, the credit market in rural and semi-urban areas with 400 million people in the age group of 18-33 years has the potential to grow. Also, the credit penetration in this segment is only eight per cent.

On a yearly basis, bank credit grew by 5.74 percent and deposits by 9.73%.
Bank credit grew 5.74 per cent year-on-year to Rs 108.43 lakh crore in the fortnight ended June 4, 2021. On the other hand, deposits increased by 9.73 per cent to Rs 153.13 lakh crore.

According to the Reserve Bank of India data, bank credit stood at Rs 102.55 lakh crore. While the deposits stood at Rs 139.55 lakh crore in June 5, 2020. Earlier, bank credit grew by 5.98 per cent while deposits grew by 9.66 per cent in the fortnight ended May 21, 2021. According to central bank data, bank credit grew by 5.56% and deposits by 11.4% in the entire FY2020-21.

The pace of vaccination will decide the path of revival

An article by RBI officials said that the pace and scale of COVID-19 vaccination will decide the path of economic revival. It also said that the economy has the necessary capacity and strength to overcome the pandemic and the already existing cyclical and structural constraints.

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