“Gen Zs prefer consumption loans for their ‘here and now’ needs,” says Bhavesh Jain, MD and CEO of TransUnion CIBIL.
Post-COVID, credit demand has surged more in semi-urban and rural areas than in urban centres, with younger consumers (below 35) driving this growth.
Borrowing patterns have also evolved—people in their 30s now lean toward credit cards and consumer durable loans, while the average age for home loan borrowers has risen to 41 years from the late 30s. “Consumers now need to save more for down payments due to rising property prices,” Jain said.
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However, credit cards have seen a slowdown in growth year-on-year (YoY), leading to a marginal rise in delinquencies. “Credit cards are used by consumers at different segments, and if they have to decide on a payment hierarchy, they would actually pay on a housing loan or two-wheeler and then pay on a credit card,” said Jain.
Going forward, credit growth is expected to improve after the festive season, though lenders remain cautious. Currently, 27% of India’s population is credit-active, highlighting the increasing reliance on formal credit channels.
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TransUnion CIBIL is India’s first credit bureau, which was earlier called Credit Information Bureau (India) Limited. It collects and keeps track of people’s and businesses’ loan and credit card payment history.
For the entire interview, watch the accompanying video
(Edited by : Unnikrishnan)
