Digital lenders put small business on watch list

Small businesses such as restaurants, petrol pumps and dry cleaners are being placed on lenders’ “watch lists”, as digital lending firms turn cautious on term loan exposure to these segments, senior executives said.

The move comes amid the crisis in West Asia, which has disrupted gas supplies to India and raised input costs for several sectors. Beyond banks and non-banking financial companies, new-age lenders are taking pre-emptive steps, given their relatively higher exposure to unsecured loans in these segments, according to the executives.