Failed auto-debit requests ease to a 38-month low in May, shows NACH data

'Improving bounce-rate trajectory suggests slippages, credit cost will descend in FY23'

The unsuccessful auto-debit requests or bounce rates eased to a 38-month low in value terms in May, despite rising interest-rate scenario resulting in repricing of loans and inflationary pressure impacting household income.

According to the National Automated Clearing House (NACH) data, the bounce rate in May eased to 22 per cent in value terms, down 50 basis points (bps) from April, and is the lowest since April 2019.

The pre-Covid average bounce rate in volume terms was 24–25 per cent. In volume terms, the bounce rate fell to a 33-month low at 29 per cent, down 87 bps from April.