The Hindu Business Line : Festive season to drive retail loans, credit card spends

"There is an increase in all kinds of loans, beginning around September and till January or February. Housing loans and generic personal loans increase. Credit card spends also increase during this period," said Mr Rajan Ghotgalkar, Country Head, Retail Banking, IDBI Bank.

The increase in the loans seen in this period is around 50 per cent, on a month-to-month basis; banks also plan advertising campaigns and exhibitions around this time, as the impact holds good for at least three months after the festive period, he said.

An official from State Bank of India agreed that personal loans' offtake would increase during this period.

"It starts from Ganesh Chaturthi and peaks during Dusshera and Diwali," he said.

At ICICI Bank, credit card spends outstrip personal loans during the festive season. According to Mr B. Madhivanan, Head-Retail Asset Products Group, ICICI Bank, "We do see an increase of about 10-15 per cent rise in personal loans during this season. But credit card spends rise between 35 per cent and 40 per cent in October- November, as against September," he said.

While north India sees higher spends in October-November, in the South it is typically higher in December, he said.

ICICI Bank plans to extend the recently concluded 5 per cent cash back scheme on credit cards.

"As the response was good, we may rework the scheme and run it for three more months," Mr Madhivanan said.

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