India’s formal credit footprint has expanded significantly over the past nine years reveals TransUnion CIBIL’s new report, Unlocking Access: Journey of Credit Expansion in India. The report presents a study from March 2017 to March 2026 on how formal credit access has widened and how participation within the ecosystem has deepened through greater demographic diversity and credit awareness.
India’s credit-eligible[1] population increased from 79 crore in 2017 to 89 crore consumers in 2026. Of this group, the share of ever-credited[2] consumers, i.e., those who have accessed retail credit at least once, more than doubled from 35% in March 2017 to 74% in March 2026, demonstrating the wide progress and penetration of formal credit in India in the last few years.
The proportion of credit-active[3] consumers within the credit-eligible[4] population also increased during this period, from 11% in March 2017 to 28% in March 2026. However, the compounded annual growth rate of the credit-active consumer base moderated from 14% during the March 2017–March 2019 period to 9% during March 2024–March 2026 period. At the same time, the share of New-to-Credit (NTC) consumers in retail originations declined from 32% in March 2017 quarter to 13% in the March 2026 quarter. These numbers indicate significant opportunity to both deepen engagement with those already within the credit fold, and to bring new consumers into the formal credit ecosystem.
Mr. Bhavesh Jain, MD and CEO, TransUnion CIBIL, said, “The past decade has been a defining one for India’s credit ecosystem. In the 2016-17 period, the country saw momentous changes in the form of demonetization, the introduction of GST and the rapid adoption of Unified Payment Interface (UPI). Over the course of the decade, regulators, banks and lenders, NBFCs, fintechs, Credit Information Companies, technological advances and the digital public infrastructure collectively expanded pathways to credit. The COVID-19 pandemic accelerated adoption of digital tools. Cumulatively, these developments are believed to have contributed to increased access to credit and financial inclusion, while enabling lenders to make more informed and timely credit decisions.”
Borrower Wallets Shift Towards Lifestyle-Driven and Entrepreneurial Credit
The deepening of borrower engagement was accompanied by a marked change in the composition of credit wallets, with consumers showing a clear preference for consumption and entrepreneurial credit.
Consumption credit[1], comprising personal loans, credit cards and consumer durable loans, emerged as the most widely held category. The share of credit-active consumers holding consumption products increased from 34% in March 2017 to 51% in March 2026, while the number of consumers holding these products grew fourfold in the same period.
Business-oriented credit[2] recorded an even sharper increase, with the share of credit-active consumers holding these products rising from 3% to 9%, while their number grew tenfold – registering the fastest expansion among the categories studied. In comparison, while gold loan[3] participation increased from 19% to 22%, growth in vehicle loans[4] and mortgage products[5] remained stable.
Mr. Jain added, “The changes in wallet composition point to how credit is being increasingly seen as a means to drive a lifestyle-driven approach today, compared to the asset-based approach seen a decade ago. Credit dispersion has travelled a long way thanks to consumption loans. At the same time, the sharp increase in business loans by individuals points to increased use of credit by individuals for entrepreneurial activity. This creates a great opportunity for lenders to take a holistic view of individual proprietors and their business together as part of their lending strategies.”
