Bigger Loans Drive 28% Growth in Digital Lenders’ Personal-Loan Books
Digital-first NBFCs in India recorded a 28% year-on-year increase in their personal-loan portfolio to ₹1.54 lakh crore in June 2026, compared with ₹1.20 lakh crore a year earlier, even as the number of outstanding loan accounts declined slightly from 5.69 crore to 5.64 crore. The growth was therefore driven largely by larger loan balances, with the average outstanding loan increasing nearly 30% from about ₹21,100 to ₹27,350. During the June quarter, digital NBFCs sanctioned ₹64,656 crore in personal loans, up 50% year-on-year, while the number of loans sanctioned rose 14% to 3.44 crore.
The expansion was particularly visible among newer and younger borrowers. Loan sanction value for customers with less than one year of credit history increased 178% year-on-year, while sanction value for borrowers below 25 years rose 104%. Borrowers below 35 accounted for 58% of digital NBFC sanction value, while around 40% of sanction value went to customers in Tier III cities and beyond. At the same time, borrowers in the high and very-high-risk credit-score categories accounted for 29% of digital NBFC sanction value, compared with 9% for banks, highlighting the importance of robust credit assessment and monitoring.
Asset quality showed some improvement, with the proportion of loans overdue by 90–180 days declining to 1.4% in June from 2.5% a year earlier. However, the rise in average loan size and lending to new-to-credit and higher-risk borrowers makes credit underwriting, early-warning systems, fraud detection and portfolio monitoring increasingly important for digital lenders as their books expand.
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