I’m not sure if this is good news or concerning news, but let me first state the facts out. Gender inequality has long since been prevalent in our society. It’s a known fact and something we are all coping with. As a millennial woman myself, I relate to this, all too fondly. Is the situation improving? In fact, let me pull out some useful statistics for you.

Between the years 2015 and 2018, a TransUnion CIBIL study revealed that there was a 48 per cent growth in credit applications amongst women.

The survey went on to reveal that women borrowers took loans of higher ticket sizes, 35 per cent higher than those taken by their male counterparts.

A large part of this spike was due to what we call the ‘millennial factor’. Studies have shown that millennials, especially women, have a wish list that they want to tick off, as soon as possible. Millennial women take ownership of major expenses in their lives and so avail loans for weddings, buying a house or a car.

Is this concerning? Not really.

According to a survey conducted by IndiaLends, called #WorkingStree, women are becoming increasingly financially independent and contributing to household finances, with a little over 76% of women making their own investment decisions and an 88% contributing to household income.

However, the same survey also found that around 46% of salaried women were taking on personal loans as compared to 32% being taken for building assets.

Why does that surprise me?

I am all for taking loans to build assets, but when it comes to smart money management, being a little careful on the personal loan front is something I want everyone to be cognizant of. According to data from 1.6 million loan applications in 2018 on BankBazaar, it was found that the average ticket size for loans amongst women was at ₹27 lakh while for men at just under ₹23 lakh. This shows that even though Indian women are fairly new to the lending space, they are willing to take on more risks when it comes to credit.

Another surprising fact that I found was with credit cards. Now before we talk about shiny plastic cards, let’s quickly look at the segment that saw the highest growth - fuel.

Yes! Fuel!

Women mean business, and that means having to travel to the workplace, commuting back and forth. So for everyone who thought that lifestyle would be at the top of a woman's spends, you’re not even close.

The rise in cards whether credit /debit cards with points for fuel consumption was a whopping 89 per cent as compared to lifestyle at 10.49 per cent. Another interesting observation was with cards with travel benefits, this was at a 73 per cent all-time high.

But what led to this trend?

Higher purchasing power: With an increase in women in the workforce today, women are able to access, understand and make informed decisions on credit today. With an increase in wanting to retire early, women are able to prioritise and execute their plans as planned. This means taking higher risks, and not waiting for opportunities to come their way.

Better tailored incentives: While I am yet to come across exclusive credit options for women in India, I have seen a rise in exclusive credit cards for women. This is not just a huge incentive for women to build a good credit history but with services tailored specifically to us, it gives me a boost to want to explore the world of credit.

Growing awareness of credit scores: I remember, not so long ago, I didn’t care about credit scores either. But when I received my first credit card, I decided to always keep my credit score as close to perfect as possible. This helped me when I later decided to take a car loan.

I don’t think I am an exception here. With an increase in the number of women becoming financially independent, the awareness of looking after credit well is also increasing. In fact, on average women have a higher credit score than their male counterparts, with an average score of 770+.

Aspirations: Women are increasingly becoming more independent. Whether it is buying a car, like me, or buying a house or even funding education. A survey conducted by ZestMoney in 2019 revealed that over 20% of loans taken by women were for education as against 6% taken by men.

Bottom Line

While we, as women, are increasingly taking more risks while building out our future, it is important to not fall into a debt trap. I am all for taking loans to build assets. In fact, we as women are better at managing debt and paying off loans than men. But the truth is, taking a loan is still borrowing from your future.

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