India’s Retail Credit Market AUM Surges 16% to ₹162 Lakh Crore; Gold Loans Lead Lending Growth

India’s retail credit market records robust growth as gold loans power lending activity and asset quality strengthens across sectors. Gold loan originations jump 103% year-on-year as retail credit disbursements rise 40%; improving asset quality signals a healthier lending environment 

Mumbai, 05 June 2026: India's retail credit market continued its strong growth trajectory in the quarter ending March 2026, with total retail credit originations rising 40% year-on-year to ₹29 lakh crore, according to the latest Retail Credit Trends Report released by Equifax India. The country's retail credit Assets Under Management (AUM) also expanded 16% year-on-year to reach ₹162 lakh crore, reflecting sustained demand across lending categories and continued confidence among borrowers and lenders alike. The report highlights a retail credit ecosystem that is witnessing robust growth alongside improving portfolio quality. According to the data, while secured lending products such as gold loans and housing finance drove much of the expansion during the quarter, lenders also reported lower delinquencies and slippages across several major product categories, indicating a more disciplined and sustainable credit environment.

Commenting on the findings, Subhankar Mishra, Head of Strategy and Interim Managing Director for Equifax Credit Information, said: "India's retail credit market continues to demonstrate strong momentum, supported by healthy consumer demand and improving portfolio quality. The simultaneous growth in credit originations and decline in delinquencies reflects a more disciplined and sustainable lending environment. Gold loans have emerged as a key growth driver, while continued strength in housing and personal loans seemingly underscores the resilience of consumer borrowing. If lenders remain focused on prudent underwriting and risk management, we anticipate that the retail credit ecosystem will maintain its growth trajectory through 2026."

Retail Credit Growth Driven by Secured Lending 

The report highlights that India's retail lending market continued to benefit from strong consumer demand, with secured credit products emerging as the primary drivers of growth. Housing loans maintained their position as the largest contributor to retail credit portfolios, while personal loans continued to witness healthy demand despite a more calibrated lending environment.

The housing finance segment recorded one of its strongest quarters, with disbursements reaching a record ₹340,000 crore during JFM 2026. Public sector banks continued to lead the segment, accounting for 44% of new home loan originations. The report also observed a growing shift toward higher-ticket home loans, particularly loans above ₹1 crore, reflecting continued premiumisation within India's retail credit market.

Across lending categories, borrowers increasingly demonstrated a preference for larger ticket sizes and secured borrowing products, highlighting growing credit maturity and changing financing preferences.

Gold Loans Become the Fastest-Growing Retail Lending Segment

Gold loans emerged as the defining growth story of the quarter, with originations surging 103% year-on-year, making it the fastest-growing retail credit segment in the country.

The segment witnessed a 37% increase in quarterly disbursements, while portfolio outstanding balances nearly doubled over the past year. Although public sector banks continued to account for the largest share of gold loan portfolios, NBFCs recorded the fastest growth, registering a remarkable 213% increase in originations compared to the same period last year.

The strong performance reflects rising consumer preference for secured borrowing, favourable gold prices, and the growing attractiveness of gold-backed credit as a quick and cost-effective source of liquidity.

Interestingly, the report also points to a divergence between gold loans and business lending. While gold loan originations expanded rapidly, business loan growth remained relatively muted at 3% year-on-year, suggesting that borrowers may increasingly be turning to gold-backed credit as an alternative financing option.

Asset Quality Strengthens Across Lending Categories

A key theme emerging from the March 2026 quarter is the continued strengthening of asset quality across the retail lending ecosystem. Net 90+ day delinquencies declined across major lending categories including gold loans, housing loans, business loans, personal loans, and credit cards. Fresh slippages also moderated during the period, likely reflecting stronger underwriting practices, improved collection efficiencies, and healthier borrower repayment behaviour.

Gold loans reported some of the lowest delinquency levels across retail credit products, while housing loans continued to demonstrate strong portfolio resilience despite rapid growth. Business loans also recorded improving performance metrics, with annual slippage ratios reaching their lowest levels during the year.

The credit card segment presented a similar picture. While new card issuance declined 9% year-on-year, portfolio balances continued to grow and delinquency levels improved across lender categories. The trend suggests that issuers are increasingly prioritising portfolio quality and customer profitability over aggressive acquisition-led growth.

Microfinance Recovery Signals Healthier Credit Environment

The report also highlights a significant improvement in the microfinance sector, which has shown clear signs of stabilisation after a challenging period. Industry-wide 30+ day delinquency improved sharply to 2.3% in March 2026, compared with 6.6% a year earlier. Similarly, 90+ day delinquency declined to 1.4%, while disbursements increased 19% year-on-year to nearly ₹79,000 crore.

The recovery indicates strengthening borrower repayment capacity, improving credit discipline, and greater stability across the broader financial ecosystem. The improvement in microfinance performance also reinforces the positive trends observed across other retail lending categories.

NBFCs Continue to Outpace Industry Growth

Among lender categories, NBFCs delivered the strongest growth performance during the quarter, recording a 97% increase in overall originations year-on-year. The sector's growth was driven primarily by gold loans and personal loans, reaffirming NBFCs' ability to identify emerging credit opportunities and serve customer segments that require faster and more flexible access to credit.

“The findings underscore the resilience and evolving maturity of India's retail credit ecosystem. As secured lending products gain prominence and portfolio quality improves across segments, it seems that lenders are increasingly balancing growth with prudent risk management. With robust consumer demand, improving repayment behaviour, and continued expansion in key categories such as gold loans, housing finance, and personal credit, the retail lending market remains well-positioned to sustain its growth momentum through the remainder of 2026,” concluded Subhankar Mishra.

About Equifax

Equifax Credit Information Services Pvt. Ltd. (Equifax India) is one of India’s leading credit information and analytics companies and part of global data, analytics and technology leader Equifax Inc. Since launching its Consumer Bureau in 2010, Equifax India has built one of the country’s most inclusive credit data ecosystems, with over 2.1 billion reported tradelines and insights across retail, microfinance, commercial and employment segments.

Serving 7,000+ banks and NBFCs, Equifax India leverages advanced analytics, AI-driven solutions and cloud-enabled infrastructure to deliver high standards of data freshness and accuracy. The company plays a critical role in enabling responsible lending, strengthening risk management and expanding access to formal credit across India’s growing credit economy.

 

For any further details, please contact:

Suhas Diwakar Zele (Head of Marketing & Communications, Equifax India)
suhasdiwakar.zele@equifax.com & marcom.india@equifax.com