In India, signs of borrower distress have been appearing in many states over the past decades. For example, in the north-eastern state of Assam, delinquency increased from 1.5 to 10 percent between September and December 2019, precipitated by the actions of a few lenders who had been allowing customers to borrow beyond their means to repay. Natural disasters and political events at the time further exacerbated the issue, leading to many borrowers being unable or unwilling to repay. The situation is likely to worsen once the regulatory forbearance associated with the COVID-19 pandemic ends.
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