Year: 2026
Type: article
Study design: Observational Study
Abstract: Loan default remains one of the more persistent challenges facing non-banking financial companies, and Bajaj Finance Limited, as one of India's largest NBFCs, is no exception. This article examines the factors that shape borrowers' likelihood of default and the analytical approach through which such risk can be anticipated. Drawing on a structured survey of 101 respondents together with an underlying logistic regression framework, the study looks at how income level, EMI burden, existing liabilities, credit score, repayment history and exposure to unexpected expenses relate to repayment outcomes. It also outlines a probability-based classification scheme that sorts borrowers into low-, medium- and high-risk categories, a tool intended to support faster and more consistent credit decisions. The survey results show that respondents are drawn predominantly from younger, lower- and middle-income segments, that a substantial share have experienced delayed EMI payments at some point, and that poor financial planning, existing debt obligations and unexpected expenses are widely seen as significant contributors to repayment difficulty. Credit score and repayment history, meanwhile, are broadly recognised as central to loan approval and to predicting future behaviour. The article concludes that combining sound credit assessment with continuous account monitoring and predictive analytics allows lenders such as Bajaj Finance to identify risk earlier and manage it more effectively, supporting growth without compromising portfolio quality.
Authors: K S Chaitra, G N Kiran
Institution: Bapuji Institute of Engineering and Technology
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W7172347258
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