Formal retail credit access doubles over past decade

Formal retail credit penetration in India rose from 35% in March 2017 to 74% in March 2026, with credit-active consumers increasing from 11% to 28%.

Consumption-led lending (personal loans, credit cards, consumer durable loans) drove growth; share of credit-active consumers holding such products rose from 34% to 51%.

Younger borrowers under 35, women, and semi-urban/rural consumers expanded the borrower base, with mobile phones replacing two-wheelers as preferred purchase.

Northern and central states (Uttar Pradesh, Madhya Pradesh, Bihar) gained credit share, while western and southern states (Maharashtra, Tamil Nadu) moderated.

First-time borrowers increasingly start with small-ticket unsecured loans for electronics and consumer goods rather than large asset-backed loans.