Rural Business Confidence Index showed a high reading of 63.9 in Oct 2021: CII- CRIF High Mark

According to a report in Business Standard, Keeping with the upturn in the Indian economy, the Rural Business Confidence (RBC) Index showed a high reading of 63.9 in October 2021. It signifies high optimism and the industry’s upbeat mood on the rural economy in India, according to an index launched by CII- CRIF High Mark.

This is the first time the duo has come out with such an index and would release a reading on it twice a year. RBC Index will be ranged between zero and 100. Higher the RBC Index, the better is the outlook on rural business sentiment.

The Survey undertaken for the index in September and October 2021 across industry sectors from different geographies showed 59 percent of respondents expect their organizations’ order books to improve affecting businesses in Rural India, the report said.

Also, 48 percent of respondents expect the profitability of their organization to improve, 54 percent of respondents expect ease of access to credit to the rural economy to improve.

The Rural Business Confidence Index is envisaged to guide policy and decision-makers, industry and financial institutions to improve sentiment, investment & lending and starting new lines of business, credit information bureau CRIF Mark- said in a statement. Confederation of Indian Industry (CII) has collaborated with CRIF High Mark.

The Index further illustrates that despite the COVID-19 pandemic, the disbursement of retail loans in rural India showed robust expansion. It witnessed a growth of 23 percent by value from Rs. 10.10 trillion in F19 to Rs 12.45 trillion in Fy 21. Growth measured in volumes was also high at 30 percent from 50.6 million in FY19 to 66.1 million in FY 21, the report said.

Disbursement of Commercial loans in three years was led by small ticket size loans. They witnessed about 100 percent growth by volume from 0.24 million loans in Fy19 to 0.49 million loans in Fy21. But, small-ticket loans de-grew by 33 percent by value from Rs 7.25 trillion in Fy 19 to Rs 4.83 trillion in FY21.

Referring to perception about infrastructure and policies, 88 percent of respondents expect improvement of digital penetration, 72% expect the quality of infrastructure to improve. About 72 percent expect improvement in government initiatives and policies to drive rural growth (Business Standard)