Highlights

Bad debt in the personal loans sector is increasing
Defaults highest in the education segment and lowest in housing: RBI
NPA in education personal loans are at 3.6 percent: RBI

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Education loans hit hardest as bad debt rises in personal loans

Name: Education loans hit hardest as bad debt rises in personal loans
Uploaded: 2024-06-28T17:19:58.000+05:30
Duration: T00M54S
Channel: Editorji News Desk
Description: Experts quoted by Moneycontrol attribute the rise in education loan defaults to more students opting for studies abroad, which leads to an increase in NPAs during the peak season

Experts quoted by Moneycontrol attribute the rise in education loan defaults to more students opting for studies abroad, which leads to an increase in NPAs during the peak season

Updated: Sep 02, 2022 10:53

Editorji News Desk

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Education loans hit hardest as bad debt rises in personal loans

Bad debt in the personal loans sector is increasing, with defaults highest in the education segment and lowest in housing, according to an RBI report.

Non-performing assets or NPA in education personal loans are at 3.6 percent, compared to 1.8 percent in credit cards, 1.3 percent in auto loans, and 1.1 percent in housing loans, as per the central bank’s Financial Stability Report for June 2024.

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Experts quoted by Moneycontrol attribute the rise in education loan defaults to more students opting for studies abroad, which leads to an increase in NPAs during the peak season.

Despite these issues, the RBI report noted a broad-based improvement in the asset quality of Scheduled Commercial Banks or SCBs across personal loan segments.

Frequently Asked Questions

What is the current rate of bad debt in the education loan sector?❯

The current rate of bad debt in the education loan sector is at 3.6 percent, according to the RBI Financial Stability Report for June 2024.

How does the bad debt rate in education loans compare to other personal loan sectors?❯

What factors contribute to the rise in defaults in education loans?❯

What does the RBI report say about the overall asset quality of banks?❯

What are the bad debt rates for other personal loan sectors mentioned in the article?❯

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Education loans hit hardest as bad debt rises in personal loans

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