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Finance schemes for consumer durables badly hit
Published on Wed, May 28, 2008 at 00:21 in Money section
Tags: Consumer Durables, Finance , New Delhi
NO FINANCING: Consumer durable players are already feeling the pinch as banks develop cold feet.
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New Delhi: After registering negative growth for the last fiscal, things are set to get worse for consumer durable companies. That is because many major banks and finance companies have stopped disbursing loans to the sector.
Industry sources say ICICI Bank has not been active in the consumer durable market this year and it is not the only one. GE Money and CitiFinancial, have also developed cold feet.
Consumer durable players are already feeling the pinch.
LG says almost 30 per cent of its sales will be impacted on account of the credit squeeze. The company is now talking to Bajaj Finance and Shriram City Finance.
Samsung, which sells around 20 per cent of its goods through finance, says it will take time for them to re-allocate their promotional schemes. Samsung is also in talks with smaller consumer durable finance companies.
Even Whirlpool, which sells around 10-12 per cent of its appliances through organised durable finance companies, is facing the same dilemma.
Summer is peak season for consumer durable companies but sales seem to be frozen.
Most players expect banks to come back to the market with alternative products by the festive season. Till then it is clearly slippery season.
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