Unsecured loan concerns: Fintechs explore long-term loans after RBI alert

Meanwhile, for the past few months, the regulator has been cautious about the increase in unsecured personal loans, which can spiral into potential bad loans

The Reserve Bank of India’s (RBI’s) recent decision to increase risk weighting on unsecured personal loans has served as a yellow signal for fintech companies offering products such as “buy now, pay later” (BNPL), and postpaid or unsecured small-ticket personal loans (STPL).
 

Fintech players Business Standard spoke to said growth for unsecured personal loans might moderate and not move into the red.

Firms giving loans of more than Rs 50,000 may register growth as against small-ticket size and small-tenure loans.
 

“There will be an upward movement of ticket size for high creditworthy customers. Further, as against offering short-term loans, say,