New Delhi, Oct 14 Digital non-banking financial companies (NBFCs) sanctioned 3 crore personal loans totalling Rs 43,019 crore in Q1 FY26, representing 80 per cent of personal loan volumes, a report said on Tuesday.
Further, the personal loans sanctioned by digital NBFCs accounted for 20 per cent of the sanction value, according to the data compiled by Fintech Association for Consumer Empowerment (FACE), a self-regulatory organisation in the fintech sector.
Their growing portfolio of Rs 1.2 lakh crore (June 2025) reflects growth underpinned by improving credit quality, the report said.
The report, based on data from credit bureau Crif High Mark, signalled that digital NBFCs are now central to India’s personal loan market, significantly contributing to the expansion of formal credit and deepening inclusion.
This trend indicates a shift in India's lending ecosystem towards sustainable, high-quality growth. As of June, outstanding digital personal loans stood at Rs 1.20 lakh crore across 5.69 crore accounts, with portfolio stress maintained at 2.5 per cent of the portfolio remaining overdue for repayment for more than 90 days.
Over 61 per cent of loans were extended to borrowers under 35 years old, with a slow yet steady rise in female participation and continued penetration into markets beyond metros, reflecting inclusive growth aligned with India’s financial inclusion priorities.
“The maturity of the market, strong customer preference for digital, and regulatory and self-regulatory rules continue to nurture the digital lending space,” said Sugandh Saxena, CEO of FACE.
FACE reported that sanction volumes and values increased by 13 per cent and 17 per cent year-on-year (YoY) in Q1 FY26, almost half the growth rate in Q1 FY25.
Over 110 digital NBFCs now anchor India’s digital lending ecosystem, serving nearly half of all active personal loan accounts.
The average loan size is Rs 14,270, with one in three loans under Rs 25,000, highlighting digital lending's focus on inclusion and flexibility.
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