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Non-Tech : ICICI Ltd - (Nyse: IC) -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (189)	2/18/2000 9:34:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 494

Small loans, big money February 19 to 25, 2000 Small loans, big money Getting finance for a computer or a TV has never been so easy. Here is how and where you can get consumer loans Today if you want to go on that dream vacation or buy your wife a diamond ring on her birthday, you don?t have to wait till your savings add up. Banks are more than willing to fund almost any conceivable expense. Having financed cars and homes for several years, these modern-day "business-savvy money-lenders", are now beginning to realise the value of financing even small domestic needs. The rider of course is that money is parted with only after the bank is convinced about your ability to repay; and at finance charges that average close to 18 per cent. One enthusiastic manager of a bank in south Delhi says he would finance any credit-worthy consumer, even if he has to go beyond the purview of the bank?s schemes. And a pointer to the fact that there is big money in small loans is the State Bank of India (SBI) which has set aside a whopping Rs 1,000 crore for consumer finance this year, the same target as that for housing loans. In this race to get a slice of the fast growing consumer finance pie no bank worth its name wishes to be left behind. HDFC Bank started its personal loan scheme this January; ICICI Bank having test-launched its schemes in Mumbai in January is introducing it in Delhi shortly; Citibank set it afloat just a few months ago while the American Express offering came earlier this month. All foreign banks are on the hard-sell route, their officers will come right up to your doorstep with loan offers. Nationalised banks, which offer more cost-effective deals, are yet to get savvy when it comes to marketing their products. While nationalised banks offer only consumer loans for specific products, foreign banks and multinational finance companies also give clean cash loans....... What makes it cost-effective is that it is levied on a diminishing balance. In contrast, multinational companies like Avco charge as little as 7.9 per cent but being a flat rate it works out to be lot more expensive. Citibank, for example, charges a flat rate of 12 per cent which translates into 21 per cent on diminishing balance. The rate of both HDFC and Grindlays Bank works out to 21 per cent while that of Stanchart, ICICI and finance company Countrywide is in the 22-24 per cent category. business-standard.com