‘New, young loan seekers show better creditworthiness’


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Of the new-to-credit consumers who were given loans in January 2019, as much as 72.30% had a credit score of 700 plus — prime category — in January 2020, said TransUnion CIBIL.

Score analysis of consumers who were granted credit in January 2019 shows that a significant proportion of these NTC consumers were scored as prime-consumers (those with a score of 700 and above) after a one-year period.

While banks and other lending institutions are too cautious in lending to new and young customers, figures reveal that new-to-credit (NTC) consumers tend to prove lower risk and build a higher credit score when they are given credit opportunities. In other words, they are making timely repayment without defaulting on their loans, showing higher creditworthiness.

However, bankers think twice before extending credit to new customers even as the credit industry witnessed a significant shift over the last decade, with increasing numbers of first-time borrowers seeking credit opportunities from institutional lenders.



Read More at India Express


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