(*3*)India’s digital personal mortgage market continued its fast enlargement in FY26, with digital-first non-banking monetary firms (NBFCs) disbursing 132 million loans value ₹2.15 lakh crore.
That is 77% of all personal mortgage sanctions by quantity and 19% by worth, in response to a brand new report by the Fintech Affiliation for Client Empowerment (FACE) based mostly on information from CRIF Excessive Mark (an RBI-licensed credit score bureau).
The information means that digital lenders are more and more turning into the first channel for small-ticket shopper credit score, significantly amongst youthful debtors and prospects outdoors main metros.
The report reveals that whereas banks proceed to dominate personal lending by worth with a 61% share, digital shadow banks now account for greater than three-fourths of all personal mortgage accounts originated in the nation. Their common ticket dimension stood at ₹16,238 in FY26, in contrast with ₹90,547 for different NBFCs and ₹4.9 lakh for banks.
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Whereas sanction quantity development for digital NBFCs has slowed sharply from 80% in FY23 to 12% in FY26, sanction worth development accelerated to 39% in FY26 from 19% a yr earlier.
The divergence suggests lenders are transferring towards bigger ticket sizes and extra established debtors fairly than pursuing development solely by means of buyer acquisition.
Common ticket dimension jumped 24% in FY26 to ₹16,238, reversing a decline seen in the earlier yr. The share of loans above ₹5 lakh additionally elevated to 10% from 8% a yr in the past.
Within the March quarter of FY26, sanction worth surged 57% yr-on-yr to ₹62,194 crore whilst sanction quantity development moderated, highlighting the continuing shift towards bigger-ticket lending.
“On the again of enabling regulatory pointers, the digital lending sector has phenomenally matured to serve the debtors throughout segments and product preferences at scale. The sector could be very excited and assured about assembly India’s evolving credit score wants. Developments in know-how, the digital financial system, and the muscle-power business have developed over time, will assist deepening and diversification in digital lending to serve shoppers with extremely personalised merchandise. All we’d like is agency anchoring in accountable lending and shopper-centricity to really enhance shoppers’ monetary well being,” Sugandh Saxena, CEO of FACE, stated.
Excellent Mortgage E book Reaches ₹1.43 Lakh Crore(*4*)
The full excellent digital personal mortgage portfolio reached ₹1.43 lakh crore as of March 2026, up from ₹1.11 lakh crore a yr earlier. Lively mortgage accounts stood at 5.5 crore.
Digital NBFCs now account for 45% of all energetic personal mortgage accounts in the nation however solely 9% of the entire personal mortgage e book by worth, gaining share in small-ticket lending.
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Debtors under 35 years accounted for 58% of the sanctioned mortgage worth throughout FY26, reinforcing the position of digital channels as the popular supply of credit score for youthful shoppers. Clients aged 26-35 alone accounted for 45% of whole sanctions by worth.
Development was significantly robust amongst youthful and newer-to-credit score debtors. Mortgage sanctions to debtors underneath 25 years grew 102% yr-on-yr, whereas sanctions to prospects with lower than one yr of bureau historical past surged 125%.
On the identical time, the client base is turning into extra seasoned. Greater than 60% of the sanctioned worth got here from debtors with a bureau classic of over 5 years, indicating that digital lenders are more and more catering to skilled credit score customers as properly.
Past Metros(*4*)
The report highlights the rising penetration of digital lending outdoors India’s largest cities.
Practically 39% of the sanctioned worth got here from Tier III cities and past, whereas 37% originated from rural areas. Over the past 4 years, the share of Tier III and smaller places has steadily elevated from 32% to 39%.
Amongst states, Telangana posted the very best development in sanctioned worth throughout FY26 at 50%, adopted by Andhra Pradesh at 46% and Uttar Pradesh at 46%.
Girls Debtors Nonetheless Underrepresented(*4*)
Regardless of gradual enchancment, ladies nonetheless account for solely 18% of the sanctioned worth in the digital personal mortgage market. Nevertheless, feminine participation has risen steadily from 14% in FY23 to 18% in FY26.
The report notes that the gender composition of digital lending is broadly much like that of banks and conventional NBFCs, indicating wider structural challenges in ladies’s entry to formal credit score.
Asset High quality Improves(*4*)
One of the extra notable findings is the development in portfolio high quality.
The share of loans overdue by greater than 90 days fell to 1.4% in March 2026 from 3.3% in March 2023, reflecting stronger underwriting and portfolio administration practices throughout the business.
Delinquency ranges had been highest amongst debtors with one to 2 years of bureau classic at 1.9%.
1.8% of youthful debtors, under 25 years, recorded a days late (DPD) ratio of over 90 days.
Even so, asset high quality remained comparatively secure throughout geographies and buyer segments.
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