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Despite Credit Crunch in 2019, India Borrowed Cautiously To Fulfil Aspirations

Adhil Shetty
Image source: Freepik

We at recently launched the latest edition of Moneymood® 2020, our annual study based on our internal data to highlight the trends pertaining to how India borrowed in 2019. And like the last edition, this year’s edition too indicated a number of interesting facts and figures. The year gone by was a roller-coaster ride and every sector had its shares of ups and downs. However, our study showed that the declining demand impacting various sectors couldn’t stop Indians from achieving their key life goals altogether as they exercised caution with credit and managed it smartly.

Read on as we share some of the key takeaways of our study which might help you form refined perspectives about personal finance trends in the country.

Women Ruled The Personal Finance Space

For the second year in a row, women out-borrowed men in key loan and credit card categories. While the difference between the average personal loan ticket size for women (Rs.2.55 lakh) and men (Rs.2.67 lakh) was low, in the case of home loans, the average ticket size for women (Rs.25.64 lakh) continued to be higher than men (Rs.23.66 lakh). Women were the main consumers for credit cards, and the number of women applicants for fuel, premium, and travel cards grew by 49.07%, 32.78%, and 21.99% respectively, compared to the previous year, the data revealed.

Affordable Housing Remained the Silver Lining

The home loan demand for affordable housing saw a spike in 2019, the data found, whereas it remained muted for high-value loans as the housing sector grappled with diminishing demand. The contribution of home loans under Rs.30 lakh increased to 72% of the total number of home loan applications, driven largely by first-time home buyers. These figures clearly indicate that India continues to implement their plans to achieve their major financial goals albeit with a lot of caution and maturity. And like in 2018, women pipped men when it came to the average home loan ticket size. While the average female home loan ticket size stood at Rs. 25.64 lakh, for men it was Rs. 23.66 lakh.

Many wanted credit cards with superior benefits

 Premium credit card applications in 2019 saw a 30% growth across the board over 2018 figures. This surge was even bigger for millennial applicants (within the 26-35 age group) at 43% growth year-on-year.  These trends clearly show that an increasing number of Indians are looking beyond their basic first credit cards with limited benefits. They are aspiring to live the good life by availing the various superior benefits associated with premium cards like complimentary lounge accesses, accelerated reward points earning potential among a plethora of other exclusive lifestyle privileges.

Diminishing credit gap between metros and non-metros

The gap between metros and non-metros is waning when it comes to credit products. The tables have, in fact, turned in some cases. For example, the average personal loan ticket size from non-metro applicants was Rs. 2.79 lakh which was higher than the Rs. 2.61 lakh average ticket size from metro applicants. On the other hand, the average car loan ticket size for non-metro applicants was Rs. 5.5 lakh, just behind the metro figures which stood at Rs. 5.7 lakh.

Demand For Car Loans Remained Low

The year 2019 was challenging year for the automotive industry – something that reflects in the Moneymood report as well. It’s not surprising that the highest car loan ticket size fell by a whopping 63% to Rs. 18.22 lakh in 2019 when compared to the previous year. However, the average car loan ticket sizes remained steady in metros and non-metros at Rs. 5.7 lakh and Rs. 5.5 lakh, respectively.

India Became Credit Score Savvy

With a 111% year-on-year growth in people checking their credit scores on BankBazaar, 2019 remained phenomenal for this segment. And while 68% of those who checked their credit scores had a score of 750 and above, 45% of the checks came from non-metro locations. These figures clearly indicate an increasing number of people getting conscious about their credit profile, thus taking an extremely important step in money management and implementing strategies to achieve critical financial goals.


In conclusion, the report reveals that despite the credit crunch, there’s no slowing down India’s aspirations. We’re seeing millennials taking wiser calls with credit, something that will help them overcome temporary financial challenges. We expect these credit trends to strengthen in 2020 as the economy pulls itself out of a slowdown.

The writer is CEO,, India’s leading online marketplace for loans and credit cards.