ICICI is making an aggressive push on unsecured loans

ICICI Bank, the country’s largest private lender, has been aggressive on unsecured loans, especially personal loans. (An unsecured loan is a loan that is taken out without the use of real estate as a guarantee for the loan. Borrowers typically need to have good credit ratings to be eligible for an unsecured loan. Personal loans (despite their high interest rates) are probably the best way. For individuals who want to borrow relatively small amounts of money and who can repay the loan within a few years.)

ICICI Bank’s personal loan book grew 61 percent year over year in June 2014-2015. During that period, credit cards grew 18 percent, home loans grew 26 percent, and auto loans grew 21 percent. In a conference call held by analysts after the end of June quarter, the bank had said its credit card and personal loan portfolio was Rs 11.682 billion, or just 2.9 percent of the total loan book. And that growth was high because of the low base. The bank retains 70 percent of the incremental unsecured loans to existing customers.

“Default levels show no signs of stress in the retail portfolio,” said ICICI Bank. (Default is failure to pay a debt by the due date.)



ICICI Bank said the credit infrastructure has been significantly improved with established credit bureaus and an existing database.

ICICI Bank has refocused on unsecured loans for the past three years. In 2008-12, it had started to shrink its retail book due to rising bad loans in the unsecured loan segment. In March 2007, the retail loan book was 65 percent of the total. In March 2012 it was 35.5 percent.

ICICI Bank then began expanding the retail book. In March 2015 it was 42 percent. The bank said the average annual growth rate in retail lending has been 20 percent since March 2012. The average annual growth rate is the average annual growth rate.

It had announced that it would expand its private customer business faster than the market and also use its marketing and technological strengths.

“ICICI Bank has expanded its retail portfolio as well as its unsecured loan segment. There is no need to worry because it has grown it carefully and not blindly,” said an analyst at a foreign brokerage firm.

Between June of this year and 2014, HDFC Bank saw its personal loan portfolio grow by 34 percent. Axis, Kotak Mahindra, and the Federal Bank do not provide a breakdown of the retail loan book.


  • ICICI Bank, the largest private lender in the country, has been aggressive on unsecured loans, especially personal loans
  • The personal loan book grew 61% in June 2014-2015. Credit cards grew by 18% during this period

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