Bad Debt at India Shadow Banks Seen Rising Amid High Fund Costs

Just when they were trying to get past their cash-crunch woes, India’s non-bank financiers may find themselves staring at a new problem: a rise in soured debt amid higher funding costs, Bloomberg News reported. That’s the prognosis about shadow lenders by Washington-based Institute of International Finance, which sees support likely from policy makers as part of their efforts to boost credit growth and bolster the economy ahead of federal elections due by May. Lending by India’s non-bank financiers, which accounted for about 4 out of every 10 consumer loans in the last three years, fell in late 2018 after default by a beleaguered shadow financier -- Infrastructure Leasing & Financial Services Ltd. -- curtailed their access to funding. haktikanta Das, India’s new central bank chief, is meeting representatives from non-bank finance companies on Wednesday. Read more

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