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CRIF High Mark shows India’s retail credit market surges 18% in Q3 FY26India’s retail credit hit ₹162.7 lakh crore in Q3 FY26, up 18%, with CRIF High Mark noting improved asset quality, bigger loan sizes, NBFC dominance, and expanding credit beyond metros.By Anshul  February 25, 2026, 12:12:28 PM IST (Updated)3 Min ReadIndia’s retail credit market expanded sharply in the December quarter, with policy changes, festive demand and a shift in lender strategies reshaping borrowing patterns, according to new data from CRIF High Mark.

The credit bureau’s latest edition of its “How India Lends” study shows that the retail portfolio reached ₹162.7 lakh crore in Q3 FY26, up 18.1% year-on-year, even as asset quality indicators improved. Active loan accounts stood at 690 million, underscoring the widening reach of formal credit.

Growth accelerates, stress metrics ease

Quarterly originations rose 41% year-on-year to ₹25.3 lakh crore in Q3 FY26. At the same time, portfolio at risk (PAR 31–180 days) declined to 3.1%, compared with 3.6% a year earlier, indicating improving repayment performance despite faster credit expansion.

Asset quality gains were visible across key segments. Gold loans saw PAR 31–180 decline to 1.8% from 2.4% a year ago, while consumer durable loans improved to 1.9% from 2.7%. The data points to a phase where growth and credit discipline are moving in tandem.

GST changes, gold rally shape demand

Policy and macroeconomic triggers played a significant role during the quarter. Gold loan originations more than doubled, rising 90.3% year-on-year, supported by a rally in gold prices that increased collateral values and borrower appetite.

GST rate rationalisation also had a visible impact. Two-wheeler originations rose 46.7% quarter-on-quarter, while auto loans increased 22.1%. Festive season demand lifted consumer durable loans by 14.7% sequentially, reflecting consumption-led credit momentum.

Meanwhile, sole-proprietor loans grew 26.2% year-on-year, suggesting sustained credit demand from micro, small and medium enterprises amid a broader economic recovery.

Bigger tickets drive portfolio value

A defining trend in the quarter was “premiumisation” — rising average ticket sizes across categories.

The average home loan ticket size increased 6.4% quarter-on-quarter to ₹33 lakh. Loans above ₹75 lakh accounted for 40% of originations by value, compared with 35% a year earlier. In gold loans, advances above ₹5 lakh contributed 36.5% of total value, up from 24% in Q3 FY25.

This shift toward larger loans created a divergence between volume and value growth. Home loan volumes grew 4.1% year-on-year, while portfolio value expanded 10.5%, indicating that growth was driven primarily by higher ticket sizes. In contrast, personal loans saw 13.5% growth in volumes but 11.6% growth in value, reflecting deeper penetration of smaller-ticket loans.

Larger loans show stronger performance

The data also highlights a correlation between ticket size and credit quality. Personal loans above ₹5 lakh recorded PAR 91–180 below 1%, while smaller-ticket loans showed relatively higher delinquency levels. The trend suggests that higher-value borrowers, on average, are demonstrating stronger repayment behaviour.

NBFCs dominate unsecured; PSUs gain in secured

The competitive landscape continued to evolve.

Non-banking financial companies (NBFCs) strengthened their presence in high-velocity segments. Their share in gold loan origination value rose to 30.7% in Q3 FY26 from 22.8% in the previous quarter, while accounting for nearly half of volumes. In personal loans, NBFCs retained a dominant 91.1% share of volumes.

Public sector banks (PSUs), meanwhile, expanded their footprint in secured lending. They led private banks in home loan origination value, accounting for 50.3% compared with 23.3%, particularly in the ₹75 lakh-plus segment. PSU banks also held a 45.8% share in gold loan origination value, aided by digital initiatives and competitive pricing.

Credit deepens beyond metros

Geographic diversification gathered pace during the quarter. Growth in regions beyond the top 100 cities was especially strong in mass-market products such as personal loans (42.3%), two-wheelers and consumer durables. The trend points to expanding access to formal credit in semi-urban and rural markets.

However, certain products remain metro-centric. Home loans derived 51% of originations from the top eight cities, while credit cards saw 41.5% concentration in these urban centres. That said, the expansion of digital lending infrastructure is gradually enabling broader outreach into tier 2 and tier 3 cities.Continue ReadingNote To ReadersDisclaimer: This article is for informational purposes only and should not be construed as investment advice. Readers should consult certified experts before making any investment decisions.First Published: Feb 25, 2026 12:10 PM ISTTagsgold loansGSThome loanslendingloans