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Customers aware of CIBIL Score, but not about interest

Home Credit India, the India arm of the international consumer finance provider with operations spanning over Europe and Asia, had recently carried out study across 7 cities to understand the levels of financial literacy among borrowers, which revealed that 52% of the borrowers understand what a CIBIL score is and its importance and that 76% of borrowers did not know the interest amount on their loans. And 68% of the respondents did not know their CIBIL score. The numbers were lowest than the country average in Patna with only 22% of borrowers aware of their CIBIL score, followed by Kolkata (25%) and Mumbai (25%). The study also found that majority of borrowers only interested to know the EMI amount to be budgeted monthly but was found to be unaware of the interest amount separately. Only 17% of borrowers in Delhi, 19% in Jaipur, and 24% in Mumbai knew the interest amount on their loans, on asking. On enquiring about the calculations of interest, a close majority of 43% across the 7 cities said that they only had partial knowledge of how their interest on a loan was calculated. The respondents were concerned and kept track of their EMI amount while the knowledge of the rate of interest charged and amount of interest was low.

 

Marko Carevic, Chief Marketing and Customer Experience Officer at Home Credit India said the research revealed that a majority wants to understand their finances better and are keen to take financial literacy lessons. He pointed out to the company’s financial education program Paise ke Pathshala, which creates an ecosystem where people can make informed, thoughtful, and beneficial financial choices at every stage of their lives.

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