As the festive season approaches in India, consumer spending is set to soar, with a projected increase of 47% this year. Shoppers are expected to indulge in gifts, travel, and home renovations, leading to a significant rise in the demand for retail loans. Personal loans and Buy Now Pay Later (BNPL) schemes are becoming popular financing options, allowing consumers to manage their festive expenditures without immediate financial strain. However, this surge in borrowing can lead to repayment challenges, as many consumers opt for higher loan amounts, risking potential defaults once the celebrations conclude. Experts emphasize the importance of effective debt collection strategies to mitigate these risks, advocating for flexible repayment plans and proactive reminders to help borrowers stay on track. Lenders are also embracing technology, utilizing AI and data analytics to streamline loan applications and improve customer experience. Balancing festive joy with financial prudence is crucial for consumers to enjoy the season without jeopardizing their financial health.
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