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GST-Led Disruptions May Have Led To Rise In Bad Loans, Gruh Finance Says

Gruh Finance also sees some pressure on spreads in the coming quarter, given the steep rise in interest rates.



A cashier counts Indian one hundred-rupee banknotes at an Oriental Bank of Commerce branch in New Delhi. (Photographer: Prashanth Vishwanathan/Bloomberg)
A cashier counts Indian one hundred-rupee banknotes at an Oriental Bank of Commerce branch in New Delhi. (Photographer: Prashanth Vishwanathan/Bloomberg)

Gruh Finance Ltd. today attributed the rise in its non-performing assets in the October-December quarter to the Goods and Services Tax-related disruptions. The transition to the new indirect tax regime may have hit self-employed people who were unable to pay back their loans, Gruh Finance’s Managing Director Sudin Choksey Told BloombergQuint in an interview.

The lender will wait for three quarters before taking a view the bad loans trajectory. Besides, he also sees some pressure on spreads in the coming quarter, given the steep rise in interest rates.

Watch the full conversation here: