New Delhi, Aug 28 (IANS) Credit demand in the country is likely to pick up by the festival season in October-November and collection of dues may reach 90 per cent by that time, according to Sasidhar N. Thumuluri, MD and CEO of Sub-K Impact Solutions.
The MD of the financial services provider said that credit operations have been severely impacted amid the pandemic and the lockdown.
He noted that there were hardly any collections in April and May due to movement restrictions and moratorium announced by the Reserve Bank of India (RBI). Collections started to rise in June and further increased in July to around 60-65 per cent.
“Demand for credit has also dropped. New disbursements started in July but nowhere near February or March levels.Since the moratorium is still in force until August end, the real impact will be felt from September when the situation begins to show signs of normalcy,” Thumuluri told IANS.
“We anticipate demand to pick up by festival season in Oct-Nov and collections also to reach over 90 per cent bythen. Thanks to cooperation extended by our key bank partners, our income has not been not badly impacted during this time,” he said.
However, its agent banking wing continued to operate during covid lockdown since banking was classified as an essential service, the MD said.
He also said that Covid has accelerated the adoption of digital transactions and even the smallest of businesses have started to accept digital payments.
“Our microfinance customers have begun paying their EMIs digitally. UPI has recorded 1.5 billion transactions in July 2020. Footfalls at our agent outlets have risen significantly during the lockdown period. These are concrete indications of increased pace of adoption,” he said.
On the recent launch of Sub-K SARTHI, Thumuluri said that the platform is designed to serve as a multi-product platform that enables new-to-bank and underbanked customers toeasily access banks and other financial institutions without the need to visit the brick-and-mortar branches.
He noted that in the post-covid scenario, social distancing may continue and the ability for banks to directly serve customers would be limited.
“This situation will hit the low income communities and MSMEs more than ever. Through Sub-K SARTHI we seek toaddress this gap through various alternative channels — an app, a nearby agent or a call center,” he said.