The revolutionary effects of payment banks and small banks have been talked up by market commentators and tech barons.
Small banks have a tech based low cost set up plus a mandate to lend 75%of its loans to the privileged sector – below Rs 25 lakhs. As this article points out small banks will affect existing institutions which lend at a higher to this category.
This will affect Gruh, Repco HFCs and shorten their runway significantly.
Does gruh and repco have a economic moat in its experience with credit appraisals of unsalaried / privileged segment? Credit appraisal skills which will take time to develop for the new small banks?
Pls share your views.
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