Team Blitz India
MUMBAI: The Reserve Bank of India (RBI) cautioned banks and non-banking finance companies (NBFCs) about high growth in unsecured personal loans and said it was monitoring these for any sign of stress.
“Banks and NBFCs would be well-advised to strengthen their internal surveillance mechanisms, address the build-up of risks, if any, and institute suitable safeguards in their own interest,” RBI Governor Shaktikanta Das said. “The need of the hour is robust risk management and stronger underwriting standards.”
He said certain components of personal loans are recording very high growth. “These are being closely monitored by the Reserve Bank for any signs of incipient stress,” Das said.
Das added that all parameters, including gross non-performing assets (GNPAs), of banks and NBFCs look better as of June-end, RBI’s caution on personal loan growth is to sensitise lenders to be mindful of issues that can pose a challenge going forward.
