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Bajaj Finance continues to tighten checks for those with multiple unsecured loans, says Rajeev Jain | Mint

Livemint

Livemint · 10m ago

Bajaj Finance continues to tighten checks for those with multiple unsecured loans, says Rajeev Jain | Mint

Bajaj Finance is tightening its underwriting norms for customers with multiple unsecured loans due to a higher probability of default, according to Managing Director Rajeev Jain. The move comes as certain segments in the banking industry are experiencing an increase in defaults, with customers delaying repayments on credit cards and personal loans. Bajaj Finance reported a deterioration in asset quality in Q3, with gross non-performing assets at 1.06% and net non-performing assets at 0.46%. The company's cost of funds increased slightly to 7.97% in the quarter.

Related News

Moneycontrol Pro Panorama | Retail loan parade of non-banks is over

Money Control

Money Control · 9m ago

Moneycontrol Pro Panorama | Retail loan parade of non-banks is over

Bajaj Finance has tightened its underwriting norms for customers with multiple unsecured loans due to data showing a higher probability of default. This move may indicate that the race for riskier unsecured retail loans in the banking industry is ending. Other non-banks have also acknowledged the risks associated with unsecured loans, and the Reserve Bank of India's decision to increase risk weights on banks' exposure to consumer credit has moderated loan growth. While delinquencies have risen, they are expected to remain below pandemic levels.

Bajaj Finance MD Rajeev Jain seeks to stay involved in shaping strategy as term nears end | Company Business News

Livemint

Livemint · 7m ago

Bajaj Finance MD Rajeev Jain seeks to stay involved in shaping strategy as term nears end | Company Business News

Rajeev Jain, managing director of Bajaj Finance, plans to stay involved in shaping the company's strategy after his term ends in early 2024, pending board approval. Bajaj Finance has implemented a 15-month transition plan, with 12 months completed. Jain, who joined the company in 2007, aims to assist in achieving the firm's short and medium-term goals. In Q3, Bajaj Finance reported an 18% increase in net profit to ₹4,308 crore and a 28% rise in assets under management.

Consumer lending to grow 15-20% annually despite headwinds: InCred Finance

Economic Times

Economic Times · 1y ago

Consumer lending to grow 15-20% annually despite headwinds: InCred Finance

Non-banking finance company InCred Finance predicts that consumer lending in India will grow by 15% to 20% annually, despite the increasing stress on portfolios. The retail lending balances in India currently stand at Rs 89 lakh crore ($11.9 trillion), with consumer finance outstanding balances exceeding Rs 22 lakh crore ($2.9 trillion) and growing at over 25% per year. While the risk performance of standard personal loans is improving, small ticket personal loans (STPL) have seen a deterioration in risk performance. Concerns about the rapid growth in unsecured loans have led the Reserve Bank of India to increase risk-weights on unsecured credit and bank loans to non-banking finance companies.

Unsecured loans in focus, fintechs see NBFC credit taps drying up

Economic Times

Economic Times · 1y ago

Unsecured loans in focus, fintechs see NBFC credit taps drying up

Non-banking financial companies (NBFCs) are reducing credit disbursal to lending startups offering small unsecured loans, following regulatory strictures requiring increased risk weights for such loans. Aditya Birla Finance and Poonawalla Fincorp have informed fintech startups that they will no longer provide capital for buy-now-pay-later and small consumer loans. NBFCs prefer to work with highly rated fintechs offering loans above INR 50,000, resulting in a drying up of credit lines for small-ticket unsecured loans. The volume of sub-Rs 25,000 loans has grown fourfold, but there is a need to protect the ecosystem from defaults.

Tech-based NBFCs try a balancing act after RBI action on unsecured loans

Economic Times

Economic Times · 1y ago

Tech-based NBFCs try a balancing act after RBI action on unsecured loans

Several mid-sized NBFCs in India, including DMI Finance, Vivriti Capital, and InCred Capital, have been expanding their unsecured lending activities through fintech partnerships. However, as the Reserve Bank of India urges caution in this area, these NBFCs will need to strike a balance between lending and conducting thorough borrower checks. The central bank has expressed concerns over potential risks associated with unsecured lending sourced through fintech firms.

Bajaj Housing Finance files papers for Rs 7,000-cr IPO

YourStory

YourStory · 1y ago

Bajaj Housing Finance files papers for Rs 7,000-cr IPO

Bajaj Housing Finance intends to raise Rs 7,000 crore through an initial public offering (IPO). The IPO includes a fresh issue of equity shares worth Rs 4,000 crore and a sale of equity shares worth Rs 3,000 crore by its parent company, Bajaj Finance. This move is in compliance with the Reserve Bank of India's regulations, which require non-banking finance companies to be listed on stock exchanges by September 2025. The funds raised will be used to strengthen Bajaj Housing Finance's capital base. The company offers various mortgage products, such as home loans and loans against property.

HDB IPO: Two concerns that could hurt the HDFC Bank subsidiary’s valuation

Livemint

Livemint · 10m ago

HDB IPO: Two concerns that could hurt the HDFC Bank subsidiary’s valuation

HDB Financial Services is facing potential challenges as it prepares for its IPO. The company's valuation may be impacted by a proposal to regulate banks' group businesses, which could require HDFC Bank to reduce its stake in the company to below 20%. Additionally, HDB's rising bad loans could affect its IPO. The company's quality of loans has deteriorated recently due to increased risk weights on unsecured loans. HDB's net non-performing assets have increased and its unsecured consumer finance book has seen significant growth. These factors may affect investors' perception and valuation of the company.

India's Bajaj Finance to raise $1.2 bln via share, warrant issue

Reuters · 1y ago

India's Bajaj Finance to raise $1.2 bln via share, warrant issue

Indian non-bank lender Bajaj Finance plans to raise up to 100 billion rupees ($1.20 billion) by issuing shares to institutional investors and warrants to its largest shareholder. The move comes amidst growing demand for loans and increased competition in the sector. Bajaj Finance aims to raise 88 billion rupees through a qualified institutional placement of shares and another 12 billion rupees by issuing warrants convertible into shares to top shareholder Bajaj Finserv. The company's stake in Bajaj Finance could increase from 52.45% to 52.57%.

As fintech lenders chase secured credit options, VCs up their bets

Economic Times

Economic Times · 2m ago

As fintech lenders chase secured credit options, VCs up their bets

The slowdown in the unsecured consumer credit market is shifting investor attention to secured lending platforms. Venture funds are increasingly investing in secured lending startups, with significant funding going to companies like Easy Home Finance and Mahaveer Finance. Fintechs previously focused on unsecured loans are now developing secured credit products. While this presents growth opportunities, fintechs face challenges like high operational costs. They aim to leverage technology to reduce costs and compete with traditional lenders effectively.

Bajaj Housing & Jio Financial: Kranthi Bathini of WealthMills shares views on these 2 stocks

Business Today

Business Today · 6m ago

Bajaj Housing & Jio Financial: Kranthi Bathini of WealthMills shares views on these 2 stocks

Kranthi Bathini of WealthMills offers investment insights on Bajaj Housing Finance Ltd and Jio Financial Services Ltd (JFSL). He suggests that JFSL stocks are suited for long-term investors without expecting short-term gains. Bajaj Housing Finance's Q3 FY25 results are promising, making its stock attractive at current valuations. Bathini recommends buying Bajaj Housing Finance shares for those with a medium- to long-term investment strategy.

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