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<ul><li>The effects of the RBI crackdown on easy <keyword id="35520" type="General" weightage="20" keywordseo="personal-loans" source="Orion">personal loans</keyword> is yet to be seen. </li><li>Despite a more than 25% decrease in acceptance rates, credit card balances have consistently increased. </li><li><keyword id="185013" type="General" weightage="20" keywordseo="gold-loans" source="Orion">Gold loans</keyword> stand out within the <keyword id="817163" type="General" weightage="20" keywordseo="retail-lending" source="Orion">retail lending</keyword> segment by providing the most favourable acceptance rates. </li></ul>Personal loans are on the rise. The month of December has seen the category in lending-verse amass outstanding balances of approximately ₹11 lakh crore, as per the Consumer Finance Overview by InCred Finance. Within the segment, the most rapid growth has been seen in small ticket personal loans (STPL), defined as loans under ₹25,000, witnessing a fourfold increase in volume over the past two years. Meanwhile, conventional personal loans, characterised by larger amounts and stricter underwriting criteria, have doubled in volume over the same period. It is to be noteworthy that in November, earlier this year, RBI increased the <a href="https://www.businessinsider.in/finance/news/rbi-tightens-norms-on-personal-loans-for-banks-nbfcs/articleshow/105269235.cms">risk weightage</a> for unsecured personal loans, and the effect is expected to be seen gradually. Retail lending trumps corporate lending Interestingly, retail lending, directed at individuals rather than businesses, now holds the foremost position and exhibits the most rapid growth within the credit landscape. Retail lending stands at approximately ₹89 lakh crores (around $1.1 trillion), constituting 46% of the overall credit in the economy. The report says that comparatively, corporate lending amounts to ₹74 lakh crores (about $0.9 trillion), securing the second largest segment. Retail balances are growing at a rate of 22% annually from a substantial base, outpacing the 17% growth of overall credit balances and the 14% growth of corporate balances. <keyword id="6387037" type="General" weightage="20" keywordseo="credit-cards" source="Orion">Credit cards</keyword> remain fastest growing retail lending category, despite decreased acceptance rates The fastest growing sector in retail lending remains credit cards. Despite a more than 25% decrease in acceptance rates and an industry-wide tightening of credit policies for new-to-credit customers, credit card balances have consistently increased. This appears to be a preemptive risk management step by lenders, as overall credit performance in the industry remains stable or even shows signs of improvement. A report by Worldline, a payment and transaction services company, highlighted a <a href="https://www.businessinsider.in/finance/news/indias-debit-card-transactions-fall-but-credit-card-spends-rise-further/articleshow/103960976.cms">surge in credit card transactions</a> in H1 2023, reaching 1.550 billion, signifying a significant increase of 19.6% compared to H1 2022. Loans for personal consumption drive retail lending The outstanding balances for consumer finance have crossed ₹22 lakh crores (approx. USD 270 billion). Despite this high base, balances continue to grow at over 25% per annum across most product categories. <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td colspan="2" style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Annual outstanding balance growth rate (%) </td></tr><tr><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Gold loans </td><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">25 </td></tr><tr><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Car loans </td><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">26 </td></tr><tr><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Personal loans </td><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">29 </td></tr><tr><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Two-wheeler loans </td><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">31 </td></tr><tr><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Consumer loans </td><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">33 </td></tr><tr><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">Credit cards </td><td style="border-left:solid #000000 0.75pt;border-right:solid #000000 0.75pt;border-bottom:solid #000000 0.75pt;border-top:solid #000000 0.75pt;vertical-align:bottom;padding:0pt 5pt 0pt 5pt;overflow:hidden;overflow-wrap:break-word;">34 </td></tr></tbody></table> Source: InCred <keyword id="1897540" type="General" weightage="20" keywordseo="consumer-durable-loans" source="Orion">Consumer durable loans</keyword> see rapid growth Consumer durable loans, akin to STPL loans in terms of loan amounts, are experiencing rapid growth. However, the distinction lies in their controlled use case, where disbursements are directly made to the merchant. The risk performance of these loans earmarked for consumer durables has shown stability. Gold loans continue to shine Gold loans also stand out within the retail lending segment by providing the most favourable acceptance rates, which is natural since it is a secured loan. Banks have observed a rapid increase in their unsecured loan portfolios, raising concerns by the Reserve Bank of India (RBI). Responding to the RBI's worries about the growth of unsecured loans, specific banks are swiftly shifting their attention toward encouraging secured lending. Among these, gold loans have emerged as an attractive financial product within the retail sector. This shift aims to mitigate risk by promoting lending backed by collateral rather than unsecured lending, aligning with the RBI's cautionary stance.

Retail trumps corporate lending as small-ticket loans see fourfold jump in past two years

<keyword id="19922074" type="General" weightage="20" keywordseo="Reserve-Bank" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank" meta.hostid="261" meta.entityid="Reserve Bank">Reserve Bank</keyword> Governor Shaktikanta Das on Thursday said surge in top-up <keyword id="21191532" type="General" weightage="20" keywordseo="housing-loans" source="keywords">housing loans</keyword> is not a system-wide issue but confined to few entities. Briefing media after the announcement of bi-monthly monetary policy review, Das said, "regulatory requirements in top-up housing loans are not being followed by certain entities and it is not a system-level problem." Such cases are being dealt at the supervisory level bilaterally, he said. Banks and <keyword id="19938300" type="General" weightage="20" keywordseo="NBFCs" source="keywords" meta.keywordsubtype="org" meta.entityname="NBFCs" meta.hostid="261" meta.entityid="NBFCs">NBFCs</keyword> have also been offering top-ups on other collateralised loans like gold loans. "Such practices may lead to loaned funds being deployed in unproductive segments or for speculative purposes. Banks and NBFCs would, therefore, be well-advised to review such practices and take remedial action," he said. Therefore, he said, banks should adhere to regulatory prescriptions relating to loan-to-value (LTV) ratio, risk weights and monitoring of end use of funds with regard to top-ups. Das further said that the divergence between loan and deposit growth may create asset liability mismatch or <keyword id="22712997" type="General" weightage="20" keywordseo="liquidity-management-issue" source="keywords">liquidity management issue</keyword>. It may potentially expose the banking system to structural liquidity issues, he said. He urged banks to mobilise deposits through innovative products and services by leveraging their vast branch network. On inflation, Das said, it is moderating but the pace of disinflation is uneven and slow. Pinning hopes on monsoon, which is 7 per cent higher than long-term average so far, the Governor said, it will have a good impact on Kharif output as well as Rabi because of improvement in moisture content in the soil. SEE ALSO:<a href="https://www.businessinsider.in/business/news/ola-wants-to-re-enter-the-quick-commerce-business-to-take-on-blinkit-and-swiggy-instamart/articleshow/112364583.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/news/ola-wants-to-re-enter-the-quick-commerce-business-to-take-on-blinkit-and-swiggy-instamart/articleshow/112364583.cms" target="_blank">Ola wants to re-enter the quick commerce business to take on Blinkit and Swiggy Instamart</a><a href="https://www.businessinsider.in/finance/banks/news/rbi-mpc-meet-cheque-clearing-time-reduced-upi-limit-increased-for-tax-payment/articleshow/112366099.cms" target="_blank"></a> <a href="https://www.businessinsider.in/finance/banks/news/rbi-mpc-meet-cheque-clearing-time-reduced-upi-limit-increased-for-tax-payment/articleshow/112366099.cms" target="_blank">RBI MPC meet – Cheque clearing time reduced, UPI limit increased for tax payment</a><a href="https://www.businessinsider.in/business/auto/news/tata-curvv-ev-with-up-to-585-km-range-launched-starting-at-17-49-lakh/slidelist/112342769.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/news/tata-curvv-ev-with-up-to-585-km-range-launched-starting-at-17-49-lakh/slidelist/112342769.cms" target="_blank">Tata Curvv EV with up to 585 km range launched starting at ₹17.49 lakh</a>

Surge in top-up housing loans not system-wide issue, says RBI Governor

New Delhi, Non-Banking Financial Company (NBFC) <keyword id="3504742" type="General" weightage="20" keywordseo="IIFL-finance" source="Orion">IIFL Finance</keyword> has become the second largest gold loan provider surpassing Manappuram Finance. "The gold loan portfolio has crossed Rs 23,690 crore assets under management (AUM), surpassing Manappuram Finance at Rs 20,809 crore worth of gold loan AUM. "This has cemented <keyword id="82050" type="General" weightage="20" keywordseo="IIFL" source="Orion">IIFL</keyword> Finance's position as the second largest gold loan provider in India in terms of AUM," IIFL Finance head of Gold Loan Business Saurabh Kumar, said. The market leader in gold loans is Muthoot Finance with an AUM of Rs 66,089 crore, as of September 2023. Kumar said, "the company has about 18.6 lakh customers and over 70 per cent of our customers are repeat customers helped by customer centric approaches like repayment grace period, no foreclosure charges, transparency in dealings and proactive customer need identification." The company expects a 25-27 per cent increase in gold loan in FY'24, he said. IIFL Finances provides gold loans through 1,486 towns and rural areas across 25 states and 4 Union Territories to salaried, self-employed and Micro, Small and Medium Enterprises (MSME) customer segments. Besides, gold loan, IIFL Finance offers affordable home loan, microfinance loans and business loans and has a consolidated AUM of Rs 73,066 crore.

IIFL Finance emerges as second largest gold loan NBFC

<ul class="summary-list"><li>Murphy Pizza, burdened by $250,000 in student loans, left academia due to low and inconsistent pay.</li><li>Pizza is an <a target="_blank" rel="" href="https://www.businessinsider.com/middle-class-americans-earning-above-poverty-live-paycheck-to-paycheck-2024-4">ALICE</a> — asset-limited, income-constrained, and employed.</li></ul>Murphy Pizza has accepted that she may never pay off her <a target="_blank" href="https://www.businessinsider.com/student-loan-forgiveness-blocked-save-plan-lawsuit-gop-attorneys-general-2024-3">student loans</a>. But she's anxious about her other expenses, like credit card bills and rent.The 51-year-old has about $250,000 in student loan debt. She completed her <a target="_blank" href="https://www.businessinsider.com/how-got-doctorate-studied-while-raising-young-kids-parenting-2024-4">doctorate degree</a> in 2009 and worked for over a decade as an adjunct professor at various colleges in the Twin Cities, where she lives. The <a target="_blank" href="https://www.businessinsider.com/average-cost-colleges-universities-tuition-living-fees-books-in-state-2024-2">cost of her education </a>is something she has "learned to live with," she said."That's the least of my worries, the student loan debt," she said. "It's the other stuff from day to day that I have to negotiate: credit card debt, medical expenses, or just rent bills."She is what economists call an <a target="_blank" rel="" href="https://www.businessinsider.com/middle-class-americans-earning-above-poverty-live-paycheck-to-paycheck-2024-4">ALICE</a> — asset-limited, income-constrained, and employed. Like 29% of US households, Pizza lives paycheck to paycheck, but her <a target="_blank" href="https://www.businessinsider.com/meet-the-typical-alice-middle-class-poverty-housing-food-benefits-2024-4">income is too high</a> for most government assistance, per Census Bureau data and cost-of-living estimates analyzed by the nonprofit United Way. This compares to 13% of Americans who live at or below the <a target="_blank" href="https://www.businessinsider.com/upper-middle-lower-class-income-wealth-poverty-new-york-census-2024-5">federal poverty line</a>, which is $15,060 for an individual.Teachers and adjunct professors are especially vulnerable to being ALICEs. Sixty percent of adjunct professors make less than $50,000 a year, despite most of them holding at least a master's degree, according to a <a target="_blank" href="https://www.aft.org/sites/default/files/media/2022/qualitylifereport_feb2022.pdf">2022 report</a> by The American Federation of Teachers that surveyed 1,900 adjunct professors across the US."There are many teaching college who are hungry and can't go to the doctor," Pizza said in an email to Business Insider. Pizza could make about $45,000 a year when she taught classes, but she had <a target="_blank" href="https://www.businessinsider.com/meet-the-typical-alice-middle-class-poverty-housing-food-benefits-2024-4#:~:text=Some%20Americans%20increasingly%20find%20themselves,and%20their%20ranks%20are%20growing.">no steady income</a> over the summer or winter breaks. She also didn't have health insurance and "never went to the doctor," she said.If there weren't enough students enrolled in her courses — which focused on history, anthropology, and religion — Pizza was often dropped from her fall or spring position with minimal notice. She had to <a target="_blank" href="https://www.businessinsider.com/how-make-money-gig-worker-uber-lyft-doordash-delivery-driver-2023-12">work side hustles</a> to support herself: teaching at three schools simultaneously, scoring exams online, and more. At one point, she was working five jobs to afford <a target="_blank" href="https://www.businessinsider.com/universal-basic-income-emergency-cash-rent-homes-government-housing-aid-2024-1">housing</a>, food, <a target="_blank" href="https://www.businessinsider.com/gen-z-millennials-giving-up-medical-care-cant-afford-costs-2024-2">healthcare</a>, and her student loan payments. She once had to declare bankruptcy because she couldn't take on a sixth job.Adjunct professors often feel like "over-educated gig workers," she said.And, after thirteen years, she quit teaching because it was unsustainable for her finances.<h2 id="1003f5d0-0f1d-44bb-af8a-ed33d1f06fc1">Pizza left her adjunct role for less pay, but it's worth the stability</h2>When Pizza left academia, she took a customer service job at a tech nonprofit making $30,467 a year, according to documents reviewed by BI. She still lives on a tight budget, but she is grateful for the security of a 9-to-5.Early in her academic career, she thought she could get her degrees, earn a full-time professor salary, and maybe join the steady tenure track. She's been trying to get a better-paying job for 15 years, but she said the positions aren't available — even with a Ph.D.Her nonprofit job has offered some relief."I'm making less money, but I know when I show up at work now, five days a week, there will be a paycheck," she said. "That's done a lot for my own sense of self."Shortly after starting the job, she needed surgery. She was relieved to have consistent health insurance for the first time in her adult life, but couldn't afford out-of-pocket medical expenses. Her best friend set up a <a target="_blank" href="https://www.businessinsider.com/tiktok-new-gofundme-views-replacing-donations-debt-tiktokers-2024-5">GoFundMe</a> to help with the costs not covered by insurance.Pizza also lives alone in her St. Paul apartment and gets discounted rent because she's been in the building for about 20 years. She said <a target="_blank" href="https://www.businessinsider.com/snap-alice-food-stamps-hunger-government-assitance-free-meals-2024-5">her income is currently too high for SNAP</a>, and her friends will help cover her groceries to make sure she eats.She's still paying off her student loans, but has been able to <a target="_blank" href="https://www.businessinsider.com/student-loan-debt-borrowers-apply-income-driven-repayment-save-plan-2023-7">enroll in SAVE</a>, President Joe Biden's income-based repayment plan. Pizza pays around $40 a month right now. Still, because of interest, she said her debt total isn't getting any smaller.Although Pizza is used to transitions, she's not sure what will happen next. Lately, she's been working on some grant-funded anthropological research and archiving, which allows her to continue dissertation work and earn some extra income.The dream, she said, would be to make all the money she needs from just one job. She also wishes she could build savings.Pizza said many people <a target="_blank" href="https://www.businessinsider.com/alice-living-paycheck-to-paycheck-without-government-assistance-snap-medicaid-2024-5">living paycheck to paycheck</a> feel lonely and isolated. She is especially grateful for her friends, who have always made sure she has food in her fridge and is able to visit the doctor when she's sick.Community is "gold," she said."If somebody's out there in the same situation that doesn't have friends or community, just figure out a way to reach out," Pizza said. "Because there will be people that will care about you."Do you live paycheck to paycheck? Are you open to sharing how you afford food, housing, and other expenses? If so, reach out to this reporter at <a target="_blank" href="mailto:allisonkelly@businessinsider.com">allisonkelly@businessinsider.com</a>.

An ALICE has $250,000 in student loan debt and left teaching for a stable job: 'There are many teaching college who are hungry and can't go to the doctor'

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<ul><li><keyword id="163007" type="General" weightage="20" keywordseo="muthoot-finance" source="Orion">Muthoot Finance</keyword> is one of the largest <keyword id="130134" type="General" weightage="20" keywordseo="gold-loan" source="Orion">gold loan</keyword> NBFC in India and it has been using its <keyword id="6354839" type="General" weightage="20" keywordseo="marketing" source="Orion">marketing</keyword> strategies effectively to make the brand a household name.</li><li><keyword id="9213956" type="General" weightage="20" keywordseo="abhinav-iyer" source="Orion">Abhinav Iyer</keyword>, GM, Marketing &amp; Strategy, Muthoot Finance tells us all the brand has been doing to not only grow its business but also to grow the category as a whole.</li></ul>It is no secret that Indians love gold. In fact, gold accounts for a large part of most Indian family’s wealth. While for years, securing loans against jewellery was looked at as a last resort, the last few years, especially the pandemic, has brought about an attitudinal shift in Indian consumers. Gold loans have been on a consistent rise over the last few years and this growth is coming from both micro enterprises and individuals. The pandemic hit many businesses and while things have been slowly moving towards normalcy, a lot of sectors still remain impacted, and people are still trying to find the balance. In such a scenario, gold loan has come up as both a convenient as well as a quick option to get cash. Over the years, there has been a shift in perception when it comes to taking a loan out on gold jewellery and one brand that has been trying to help the segment grow by trying to fasten this change is Muthoot Finance. Over the last few years, the brand has consistently stayed in the public consciousness with its marketing strategies. <keyword id="6357912" type="General" weightage="20" keywordseo="amitabh-bachchan" source="Orion">Amitabh Bachchan</keyword> has been a face of the brand for four years now. It has also been the Principal Team Partner for Chennai Super Kings, having turned it into a trusted, household name. <div type="Youtube" id="WZl9-VYIErY" title="Muthoot Finance - Haathi Pe Bharosa Karogey Toh Pakka Jeetogey - 2.5 Lakh Customers" thumbUrl="https://i.ytimg.com/vi/WZl9-VYIErY/mqdefault.jpg"></div> <div type="Youtube" id="ZpFUp9_P4X8" title="Muthoot Finance- Haathi Pe Bharosa Karogey Toh Pakka Jeetogey!" thumbUrl="https://i.ytimg.com/vi/ZpFUp9_P4X8/mqdefault.jpg"></div> We recently caught up with Abhinav Iyer, GM, Marketing &amp; Strategy, Muthoot Finance to understand how the pandemic impacted the company’s business and the role the brand has been playing in not only educating consumers about the sector but also helping the sector grow. Muthoot Finance’s growth story While the pandemic was not kind to many sectors and businesses, Muthoot Finance was able to sustain its growth, Iyer tells us. The consolidated AUM has grown by nearly 80% in the last three financial years from 2017-18 to 2020-21. Its consolidated net profit has grown by 114% during the same period. In other words, it has more than doubled during the said period. “We have grown considerably when it comes to our book size in the last few years. This year too, we are looking at growing our book size by 15%. We have made similar growth in terms of percentages when it comes to our profitability too. We serve over 2.5 lakh customers every day through our network of over 5000 branches. Contrary to common perception that we are a South-based brand, we are today a national brand, and grown consistently over the last decade,” shared Iyer. The brand has also been on an expansion mode. Over the last 2-3 years, it has added over 200 branches across the country. “If stock prices are a testament, we have made a healthy northward stride. From every stretch of imagination, we have grown, in terms of our physical branch presence, our customer base and our profitability over the last two, three years. And our marketing strategies have contributed considerably to this healthy and sustained growth,” added Iyer. Creating a winning marketing strategy It is often said that during times of crises, marketing budgets are usually the first to get slashed. We saw a lot of brands that stopped communicating with its consumers during the pandemic. However, Muthoot Finance is one brand that does not believe in this. In fact, it believes in staying in the public consciousness, staying constantly engaged. It has a half-yearly marketing strategy where it comes up with a high decibel campaign every six months, a strategy that has worked well for it. The brand recently launched its campaign ‘Hathi pe bharosa karoge toh pakka jeetoge’, featuring Amitabh Bachchan. The brand also recently launched the second season of its radio campaign called Muthoot Finance Sunheri Soch. At a time when more and more brands are steadily increasing their spends on Digital, while decreasing spends on traditional mediums, Muthoot Finance is one brand that has been consistently using mediums like Print, Radio and Outdoor. Speaking about its latest radio campaign, Iyer said, “Storytelling is the oldest form of teaching’ and we also believe that radio has always been seen as a credible and authentic medium of communication, hence we chose it as our primary medium of communication to reach out to our target audience and new customers. We also wanted to have a female voice this season and bring freshness to the table, hence this year we are extremely delighted to partner with <keyword id="6355846" type="General" weightage="20" keywordseo="madhuri-dixit" source="Orion">Madhuri Dixit</keyword> for Season 2. We have extensively researched and customized our series to be launched via radio alongside strong amplification across all prominent digital channels. We recorded a significant increase in our new customer acquisition and queries post the launch of Season 1. Thus, we did not hold back ourselves in investing again in radio and celebrating the art of <keyword id="282281" type="General" weightage="20" keywordseo="storytelling" source="Orion">storytelling</keyword>." On why the brand continues to invest on traditional mediums while also investing on newer mediums like Digital, Iyer added, “We are a national brand with around 5440 branches across India. More than 70% of our branches are in semi-urban and rural areas. We have served nearly 70 crore customer (including repeat customers) since our inception. So from all those parameters, we are a large, spread-out, national brand. So its important that some of these mass mediums are always there as part of our media mix. It would never be possible for us to do away with any of the mass mediums because the reach from mass media is critical for us. Meanwhile, digital is also a very important cog in the wheel. In the last three years, our digital and our IT teams have been working tirelessly to ensure the technological upgradation of our products and services. We launched our Gold Loan at home offering during the pandemic. That was a huge value-add from a technology perspective. There was a time you had to visit a branch to repay your loan interest. Today, you can do that using any digital payment platform, our chatbot or our WhatsApp business account. So today, it is not compulsory for people to visit the branch physically for availing loans or paying their interest. We are also investing substantially on digital marketing. Atleast 10% of our marketing budget is invested into digital marketing.” He also added that TV still makes for the largest chunk, between 40-45% of its marketing budgets. On what it got right when it comes to its marketing strategy, Iyer said it was a combination of a few things. “In the last few years, we have been on a marketing transformation journey. Firstly, partnering with Mr Bachchan has helped us cut across geographies, gender and age groups. Secondly, we partnered with Chennai Super Kings in 2018 when they were just coming back after a short break. <keyword id="6354832" type="General" weightage="20" keywordseo="ms-dhoni" source="Orion">MS Dhoni</keyword> is also someone who enjoys almost the same stature that Mr Bachchan does in Bollywood. He’s a trustworthy, dependable and balanced individual. So our partnership with CSK helped us in the Tamil Nadu market where we have about 900-950 branches. We have also been using transit medium very effectively and The Greater Kailash metro station and the Nandanam station in Chennai have our branding and it has completely transformed the stations. We also came up with a unique initiative during the Kumbh mela when we created huge gold lockers to help devotees keep their valuables at a safe place. This campaign helped us win numerous awards. Lastly, over the years, we have created a culture of launching half-yearly campaigns, new communications to bring about an attitudinal change in the minds of people. We try to be present throughout the years on all major ATL and BTL mediums. I believe these strategies have helped us grow as we are also trying to grow the category.” Owing to its presence in smaller towns and cities, the brand also focuses a lot on regional communications. The brand puts out its communications in 11 languages to ensure its reach is far and wide. Future areas of focus In what the scope for the segment is in the future, Iyer said, “Overall there are around 25,000 tonnes of gold (household jewellery) in the country and less than 5% of it is monetized. So there’s a huge potential for growth, both for us and the industry as a whole. So the focus would be on getting new customers to try and opt for gold loans. Its also a very simple product, you only pay interest for the number of days for which you have availed the loan. There is a whole lot of customer benefits which can help people benefit from the product. So our primary objective, even from a marketing perspective would be to grow the category significantly and help the category prosper by itself. We will also constantly keep working on bringing about an attitudinal change in people through our marketing and communications,” concluded Iyer.

Here’s how Muthoot Finance is bringing about a perception change around gold loans with its marketing initiatives

Gold loan providers in India face a rise in robberies as gold prices rise

The demand for <keyword id="18712" type="General" weightage="20" keywordseo="gold" source="Orion">gold</keyword> went up by 14 per cent to 191.7 ton in India during the third quarter of this calendar year, said the <keyword id="113718" type="General" weightage="20" keywordseo="world-gold-council" source="Orion">World Gold Council</keyword> (WGC) on Tuesday. According to the WGC, the gold demand in India was at 191.7 ton (value ₹85,010 crore) during Q3 2022 as against 168 ton (₹71,630 crore) of the corresponding period in 2021. The jewellery demand for the period under review was at 146.2 ton up from 125.1 ton the previous year. On the other hand, the total investment demand for Q3 2022 at 45.4 ton in comparison to 42.9 ton in Q3 2021. The recycled gold showed a downward trend in Q3 2022 with 16 ton as compared to 20.7 ton in Q3 2021. For the nine months of 2022 the gold demand stood at 497.8 ton (jewellery 380.7 ton, investment 117.1 ton) as compared to 453.5 ton (jewellery 345.9 ton investment 107.6 ton "India's total gold demand in Q3 2022 at 191.7 tonnes is a 14 per cent increase over last year. This reflects better-than expected performance and strong consumer interest, helping year-to-date demand return to pre-Covid levels," said Somasundaram P.R., Regional CEO, India, WGC. Credit expansion added impetus to this demand, with bank loan growth touching a nine-year high by quarter-end. He said the recovery in gold jewellery demand was primarily driven by urban India, more specifically Southern parts, underpinned by robust economic activities with a 17 per cent y-o-y increase in tonnage terms. Rural demand however, was impacted by seasonal effect (monsoons) and inflation. On the other hand, Indian bar and coin demand also saw a six per cent y-o-y improvement to 45.4 ton, he added. "Looking ahead, Indian retail investment is likely to continue to benefit from safe-haven demand amid rising interest rates and a weakening rupee. There's optimism in the overall outlook for the rest of the year with weddings and Diwali demand in Q4, but it is unlikely to match last year's record-breaking Q4. Our gold demand estimate for the full year is around 750-800 ton similar to last year," Somasundaram said. At the global level, WGC said the demand for the yellow metal (excluding OTC) in the third quarter of 2022 hit 1,181 ton, up 28 per cent year-on-year. Strong demand pushed the year-to-date total to its pre-Covid levels. Gold demand was bolstered by the consumers and central banks, although there was a notable contraction in investment demand. According to WGC, investment was down 47 per cent year-on-year, as exchange traded fund (ETF) investors responded to a challenging combination of markedly higher interest rates and a strong US dollar with significant outflows of 227 ton. These movements, alongside weakness in OTC demand and negative sentiment in futures markets, hampered gold's price performance -- contributing to an eight per cent quarter-on-quarter drop in the price during Q3 2022. Just as consumer gold demand firmed, central bank buying picked up significantly with estimated record purchases of nearly 400 t in the third quarter, said WGC. "Looking ahead, we anticipate central bank buying and retail investment to remain strong and that could help offset potential declines in OTC and ETF investment that may prevail if the dollar strength persists. We also expect to see jewellery demand continue to perform strongly in some regions such as India and Southeast Asia, while the technology sector will likely witness further decline in the face of economic deceleration," Louise Street, Senior Markets Analyst said. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/rbi-to-launch-the-nations-first-digital-rupee-pilot-project-for-the-wholesale-segment-today/articleshow/95221874.cms">RBI to launch the nation's first digital rupee pilot project for the wholesale segment today</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/icertis-raises-150-million-to-boost-contract-lifecycle-management-business/articleshow/95209273.cms">Icertis raises $150 million to boost contract lifecycle management business</a>

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