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A day after the Reserve Bank delivered another rate hike, a domestic ratings agency -- Icra Ratings has said the increases will not impact collection efficiencies for non-bank lenders. It said this is so primarily because of the collaterals given by borrowers and the priority they accord to repayments.

The RBI has hiked rates in five consecutive policy reviews since May 2022 in order to curb inflation, which has led to an overall jump in the interest rates in the system. It said typically housing loans and loans against property pools carry interest rate risks. It added that the collection efficiency is expected to remain robust on the back of strong outlook for majority of the sectors though impact of the uncertain global environment is difficult to ascertain at present.

Besides, it said non-bank finance companies (NBFCs) and housing finance companies are reporting collection efficiencies of 97-105 per cent for the first nine months of the fiscal, as per an analysis of retail pools securitised by such lenders. Securitisation is the bunching together of retail loans to form a pool which is passed on to another entity for upfront payments. The healthy collections are on improved economic activity, a favourable operating environment and non-banks returning to normalcy after two years of interrupted operations during the pandemic.