InduInd Bank to start credit cards, personal loans segments

A senior executive of IndusInd Bank informed the bank is planning to start credit cards and personal loans segments in the next financial year.

SV Parthasarthy, head of consumer finance at the private sector bank told, “We see good potential in these segments and are considering introducing these products in 2010-11.” Earlier till 2005-06 bank was in personal loans lending but it stopped when there was increase in delinquencies.

Last year during the economic slowdown most banks witnessed increase in bad loans in credit card and personal loan segments.

To keep control on delinquencies, now bankers are targeting influential customers who are having good relationship with the bank. IndusInd will be following the same strategy. Parthasarthy said, “We are looking to tap our existing customer base.”

He added, “A lot of mistakes have been made but there will possibly be a time when banks are bullish on this segment again. Banks have improved their customer screening processes and with the advent of CIBIL (credit information bureau), they now have more information on potential customers”.

IndusInd Bank Managing Director and CEO Romesh Sobti told the bank for the current financial year has planned to expand its retail loan book by 20 per cent. This will amount to 40 per cent of the bank’s Rs 19,090-crore loan book.

However in the vehicle loans segment IndusInd Bank has an important place. Bank’s commercial vehicle loan accounts for 19 per cent of its loan book whereas other vehicle loans amount to about 13%.