• Notification Date: 21-01-2025
• Notification No: N/A

Fintech surging ahead, taking a 76% market share of Indian personal loans

Fintech lenders are India's bright shiners, but so are the old banks in the money market for personal loans while otherwise kept engaged. Touching a cumulative of more than 76% as of the first half of FY25 to create a commercially viable space, the latter are compared to the last period and rejected the reports that had indicated that while volume of sanctions on personal loan dropped 21 percentage points, it is the value which has come down by 30 percentage points.

The banks being set aside helps RBI to send advisories. Basically, just as some digital lenders that would be able to provide loans with small ticket size for first-time borrowers unserved by mainstream banks, Fintech firms filled this gap. The average size of a fintech loan is found to be around Rs. 9,200, while the average bank loan works out to Rs. 4.4 lakh thereby contributing 12% to the total disbursement value of loans.

So far in FY25, fintechs have disbursed 5.3 crore loans worth Rs. 49,000 crores. That's quite a figure which is indicating a strong growth in terms of volume. Recently, however, in terms of outstanding loans, a dip of 10% was observed, as compared to June, which might indicate if some growth has already started to stabilize. The report further notes some interesting trends with regard to borrower profiles. Borrowers are mostly the minorities aged under 35, with an 85% among them being male. Over fifty percent of the loans were dispersed to a client profile that could be classified to belong to towns and cities; however, there is some growth towards areas beyond upper city sizes.

Fintech lenders consequently focus a lot of their efforts to ensure access to credit, even for those that are less well-endowed, at this timestamp plays the most important role in the narrative of financial inclusion for India. Since most of the large-ticket loans with mature borrowers occur within a range.