Car loans providers are squealing from liquidity crunch during this festive season. At one end where car manufacturers are offering schemes and discounts to lure customers, the cash crunch in the finance market is taking car consumers away.
Industry sources say that things have really gone bad in the finance industry. Auto financers are not even disbursing the sanctioned loans.
Many auto financers including Kotak and Reliance Capital have cut back on disbursals and are stifling the festive mood of car consumers.
Reliance Consumer Finance Deputy CEO, KV Srinivasan, said that the cash crunch in the industry has directly or indirectly affected the entire Indian economy. However, the finance companies are trying to counter the situation with close monitoring and regulation.
Other big car finance players like ICICI has also been impacted by this liquidity crunch, which has eventually dropped down the car sales to about 50%. Tata Capital is still making efforts to raise money from the open market and chalk out viable options to fulfill the aspirations of car consumers.
In the past 7-10 days, there has been a sharp drop in disbursal. Nothing can be commented on how long it will take to revitalize the finance market.