Let us agree to one thing - demonetization caught everyone off guard. Truth is that you did not think that such a thing could happen one day. But as of today, that ‘unexpected’ thing has happened and things are changing a lot now.
Now think of those people who till just before the demonetization announcement, were planning to take a loan. Should they take loans now or wait for later?
The first thing to consider in such questions is the need for money. Was their need for loan urgent that could not be postponed? Or could they delay their loan applications for few months?
If their needs were urgent, there is nothing much to do. They would necessarily have to take the loan and be done with it.
But what about those who can wait? Now the next question that you will have is that what is the reason to wait?
The answer is that demonetization has resulted in banks getting oversupplied with a lot of low-cost deposits. Now the banks need to lend this money to borrowers. But chances are high that there won’t be enough borrowers to borrow this huge quantum of money. As strange as it may sound, it is still true. After the unexpected demonetization agenda of the government, people have become cautious. The uncertainty has increased drastically. And to be honest, most people have no clue what will happen in near future. Everyone has their opinion to share. But coming back to banks finding it tough to find borrowers, there is only one option left for the banks. To reduce the loan rates to attract more borrowers.
So for those who are ready to wait for some months, chances are high that they will get loans at lower rates than what are available today. Isn’t it? So if you were till recently looking to take a personal loan for some non-urgent work, it makes a lot of sense to postpone your loan applications for few months. It will help you save a lot of money on interest payments in the long run.
