Regulatory scrutiny bearing fruit

THE muted growth in personal financing is expected to continue, as lenders, both from the banking and non-banking segment, and consumers become increasingly wary of the risks associated with such financing.

The close scrutiny by regulators to impose some kind of discipline and financial checks on lending for personal financing is seen to be bearing fruit, with the loan growth in this segment slowing to a low of 7.1% year-on-year (y-o-y) in August 2013. This slowdown, from the 7.6% y-o-y growth recorded in July 2013, also bucks the trend of the slightly increased total banking industry’s loan growth of 9.3% from 9.2% y-o-y in the respective months of August and July 2013.