Personal retail loan disbursements recorded an impressive growth of 42 per cent from March 2021 to March 2022, reflecting an improvement in overall economic and business sentiment, said a joint study by Equifax and Andromeda.

  The number of active personal loans increased from 3.5 crore as of March 2020 to 4 crore by March 2021, and to 6 crore by March 2022, it added.

The book size of personal loans rose from Rs 5 lakh crore as of March 2020 to Rs 6 lakh crore as of March 2021 and further to Rs 8 lakh crore as of March 2022.

"This is a strong indicator of the revival in consumption in the country," said K M Nanaiah, Managing Director, Equifax Credit Information Services Pvt Ltd and Country Leader, India & MEA, Equifax.

The total portfolio outstanding of retail industry increased from Rs 71 lakh crore (March 2020) to Rs 80 lakh crore (March 2021), and further to Rs 89 lakh crore  as of March 2022.

Private banks experienced the highest growth of portfolio outstanding with a 32 per cent increase from March 2020 to March 2022, while that of public sector lenders stood at 21 per cent.

"If the trend in the growth of personal loans sustains, we can safely assume the economy will do well in the coming years. At the same time, we must keep in mind interest rates are on the rise following three consecutive rate hikes by the Reserve Bank in four months," said Raoul Kapoor, Co-CEO, Andromeda Sales and Distributions Pvt Ltd.

The retail industry reported 46 crore active loans as of March 2022, the study added.

Headquartered in Atlanta, Equifax is a data, analytics, and technology company. Founded in 1991, Andromeda is one of India's largest loan distributors.