Home improvement top reason why millennials take personal loans
37% of all personal loans disbursed by SimplyCash were taken for home improvement. This was followed by factors like medical emergencies (28%) and marriage and family functions (12%)
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Mumbai: Home improvement and medical emergencies are the top two reasons why majority of Indians, especially the millennials, opt for instant personal loan, shows analysis of data involving lakhs of users of SimplyCash, the instant loan app powered by the Hero Group.
In the last 12 months, 37 per cent of all instant personal loans disbursed by the firm were taken for home improvement. This was followed by factors like medical emergencies (28 per cent) and marriage and family functions (12 per cent). About 5 per cent of customers took a loan for education, be it for their child's education or for upskilling their own skills. Other causes included business-related expenses (2 per cent), holidays (2 per cent) and paying off debt (2 per cent).
Talking to Bizz Buzz, Prashant Chopra, National Manager, Digital, Hero FinCorp, says: "People are going for all kinds of home renovations and repairs. There are also consumers who are purchasing consumer durables and furniture as part of their home upgradation plan. SimplyCash offers loans between Rs 50,000 and Rs 1.5 lakh, which varies from customer to customer."
The percentage of applicants taking instant personal loans for home improvement has been increasing over the years. It now accounts for 37 per cent of all loans disbursed by us in the last 12 months, a sharp increase from the figure of 28 per cent in the previous year. Most of our customers belong to the millennial generation (those currently below 40 years of age). Our data shows that this segment is now focusing on more serious priorities like home improvement and health,rather than funding lifestyle or recreational needs. This may be the lingering effect of the pandemic, due to which discretionary expenses are still being delayed."
The company is seeing a robust demand for digital lending platforms for taking personal loans due to the ease with which funds are disbursed, compared to traditional banking. However, it has cautioned people to go for only trusted apps. Buoyed by its strong growth trajectory, SimplyCash intends to double its presence to 200 locations across India in the next two years.
