Are Loan Sizes Higher When Women Borrow?

As per the numbers, the ratio of working males in India is much than women. The latest study reveals that women borrowers have outplayed men in the last few years, in terms of the size of borrowing.

A higher loan amount would mean there’s a woman working in the house in comparison to working men alone in a household. In fact, banks have introduced special loan offers for women with interest rates based on a points system (100bps = 1 percentage point) & also fixed lower for men.

A study by the credit bureau TransUnion CIBIL reveals a sporadic growth of 48% in successful online credit applications among women askers between the years 2015 and 2018. Whereas the growth is much lower amidst male borrowers at 35%.

The information also showed that 8.6 million first-timer women borrowers are opening new loan accounts per year and 66% of these women are from the states of Tamil Nadu, Kerala, Andhra Pradesh, Maharashtra, and Karnataka.

CIBIL expects better growth in credit by women borrowers based on multiple factors like a rise in women’s education, increasing consumption of consumer durables in the market, and an increase in the number of working women.

Another revelation says that a big chunk of business loans originate in the states with the highest number of women entrepreneurs. States like Tamil Nadu and Kerala have women borrowers with the lowest risk profile, a numerical above 750. According to findings, women age with grace & financial prudence & their average credit score increases as well.

When you look at the spending patterns, especially of a high-value item, it’s clear that women try & avoid big-ticket purchases when they can do away with lower value ones. Male borrowers take up to Rs 49.9 lakh for an asset like a car, whereas a female loan ticket size would be Rs 12.9 lakh for a car.

In Bangalore as well, women lead by a margin of at least a lakh and the ticket size stays fixed at Rs 37.85 lakh. In Delhi, the average home loan size of men stands at Rs 24.48 lakh while for women is Rs 27.98 lakh. In Chennai, it totals up at Rs 30.10 lakh for men as against Rs 34.79 lakh set out for women. In Kolkata, the difference comes out at about Rs 15.86 lakh with the average ticket size by women at Rs 37.84 lakh. It is easy to understand that women borrowers will have a double-edged advantage with two-income accounts running in the family, which makes the ticket-size much higher. This is in contrast to how primary men applicants have a smaller loan size in the household.

We have been experiencing a boost in the overall household income due to more & more women taking charge of responsibilities. Women seem to now have the turned into the powerhouse of talent & a globe-trotter just as much as men have been in the past. The applications for travel credit cards grew almost by 73%, higher than male applications at about 71.5%. In lifestyle credit cards too, applications from women grew at a 10.5% rate, compared to men at 8% .