Digital loans get younger and more non-metro as sanctions reach Rs 3.4 crore in Q1 FY26-27, says report

As per the latest business developments, Digital personal lending continued to expand in the first quarter of Financial Year 2026-27, with digital NBFCs sanctioning 3.4 crore personal loans worth Rs 64,656 crore, according to the Fintech Association for Consumer Empowerment (FACE). As of June 2026, the digital personal loan volume was 5.6 crore with an outstanding value of Rs 1.54 lakh crore.

The report, which analysed data from the credit bureau CRIF High Mark, studied digital lending in the personal loan segment across more than 110 Digital NBFCs from April 2022 to June 2026.

According to the findings of FACE, an RBI-recognized organisation in the fintech sector, the average ticket size for Digital NBFCs stood at Rs 18,802 in Q1 FY26-27, compared with Rs 70,025 for other NBFCs and Rs 4.52 lakh for banks.

Within the Digital NBFC segment, loans below Rs 25,000 accounted for 27 percent of sanction value, while loans of Rs 25,000 to Rs 50,000 accounted for 12 percent. Loans in the Rs 50,000-Rs 1 lakh and RS 1 lakh-Rs 2 lakh categories each accounted for 14 percent, while Rs 2 lakh-Rs 5 lakh loans accounted for 17 percent and loans above Rs 5 lakh for 16 percent.

Digital loan expansion shifts towards younger and non-metro borrowers

In terms of age of borrowers, the report noted that digital NBFC borrowers were relatively young, with 58 percent of sanction value going to customers below 35 years of age, of whom 14 percent were below 25, and 44 percent were aged between 26 and 35 years. Around 40 percent of Digital NBFC sanction value went to customers with a bureau vintage of less than five years, while 61 percent came from customers with a bureau vintage of more than five years.

Digital NBFCs had a 30 percent share of sanction value in the medium-risk (578-644 credit score) category, 20 percent in low risk (645-693 credit score), and 16 percent in very-low risk (694-900 credit score). Similarly, around 22 percent went to high-risk customers (400-577 credit score), while 7 percent went to very-high-risk borrowers (300-399 credit score), and 4 percent to customers who were not scored. Banks had a much larger very-low-risk segment (49%) than digital NBFCs (16%).

The report further noted that sanction value for digital personal loans grew across the top 10 states, geographical categories and gender groups in Q1 FY26-27 compared with Q1 FY25-26. Among the top 10 states, Andhra Pradesh recorded the highest expansion (38%), followed by Uttar Pradesh (35%), and Tamil Nadu (34), while Delhi recorded the lowest expansion (26%).

Across geographies, sanction value grew fastest in Tier III and beyond (58%), followed by rural areas (56%), and semi-urban areas (53%). Female borrowers recorded 59 percent expansion in sanction value, compared with 48 percent for male borrowers.

"The report underlines the scale and relevance of Digital NBFCs in India’s unsecured credit market. Their ability to serve consumers across demographics and use cases is an important contribution to the expansion of formal credit. Quality expansion will be sustained by keeping customer interest, transparency and responsible conduct at the centre and engaging with consumers for responsible credit behaviour," the organization's release quoted Sugandh Saxena, CEO of FACE, as saying.