Festive Credit Boom: Is Now Smart to Borrow?

Indian banks, including PNB, expect credit growth to jump up to 2% this quarter driven by festive season demand. More loans are being given out — but that doesn't always mean borrowing more is smart for your wallet.

Here's what happened: PNB's MD has indicated that festive season demand is pushing credit growth up by as much as 2% in the current October–December quarter.. This signals that banks across India are ramping up personal, home, and consumer durable loan disbursements to capture seasonal spending.. Higher credit growth often means lenders are running promotional offers — lower processing fees, cashbacks — but interest rates may not fall equally for all borrowers..

What you should do: Compare the annualised interest rate (APR), not just the EMI amount, before accepting any festive loan or credit card EMI offer from your bank.. Check your CIBIL score before applying so you qualify for the best rate — limit hard inquiries to 1–2 lenders to avoid a score dip during the festive rush.. Calculate your total EMI burden: if all your monthly EMIs together exceed 40% of your take-home salary, avoid adding a new loan this season regardless of the offer..

If your bank calls with a 'pre-approved festive loan', ask them to email the full sanction terms — lenders are legally required to disclose the APR, and seeing it in writing often reveals the real cost.