India’s personal loan market shows a clear difference between digital NBFCs and traditional banks when it comes to the size of loans being sanctioned. Digital NBFCs are serving a large number of borrowers through smaller-ticket loans, while banks continue to provide significantly larger personal loans.
According to data from the Fintech Association for Consumer Empowerment (FACE), based on information from CRIF High Mark, the average personal loan sanctioned by digital NBFCs stood at ₹18,802 during Q1 FY26-27. In comparison, the average ticket size for banks was ₹4.52 lakh.
During the quarter, digital NBFCs sanctioned around 3.4 crore personal loans with a combined value of ₹64,656 crore. This represented 70% of the total number of personal loans sanctioned, but only 22% of the overall sanction value.
Banks, on the other hand, accounted for just 7% of the total loan volume but contributed 52% of the total sanction value.
Smaller Loans Drive Digital Lending Volumes
The difference in average ticket sizes explains much of the gap between the two segments. Other NBFCs recorded an average sanction size of ₹70,025, placing them between digital NBFCs and banks. Across the overall personal loan market, the average ticket size was ₹61,112 during the quarter.
Digital lending has traditionally focused on customers looking for relatively small amounts of credit, often for shorter borrowing periods. FACE noted that the digital lending model is particularly suited to customers seeking smaller-value loans for shorter durations.
The loan distribution during Q1 FY26-27 reflects this pattern. Loans below ₹25,000 contributed 27% of the total sanction value generated by digital NBFCs. Another 12% came from loans ranging between ₹25,000 and ₹50,000.
However, digital NBFC lending is not limited to very small-ticket borrowing, with loans above ₹50,000 also making up a substantial portion of the overall sanction value.
Digital NBFCs vs Banks: Key Numbers
| Parameter | Digital NBFCs | Other NBFCs | Banks |
|---|---|---|---|
| Loans sanctioned, Q1 FY26-27 | 3.4 crore | 1.1 crore | 0.3 crore |
| Sanction value | ₹64,656 crore | ₹77,699 crore | ₹1.57 lakh crore |
| Share of sanction volume | 70% | 23% | 7% |
| Share of sanction value | 22% | 26% | 52% |
| Average ticket size | ₹18,802 | ₹70,025 | ₹4.52 lakh |
Source: FACE, Digital Personal Loans – April-June 2026.
Younger Borrowers Form a Large Share of Digital Lending
The customer profile also differs across lending segments. Digital NBFCs have a comparatively younger borrower base, with 58% of their sanction value going to customers below the age of 35.
Borrowers from Tier III cities and beyond accounted for around 40% of the sanction value, highlighting the reach of digital lending beyond larger urban centres.
Loan sizes within the digital lending segment also vary according to the borrower’s age and credit history. FACE data shows that average ticket sizes tend to increase with the borrower’s age and bureau vintage. Urban and metro customers also recorded higher average loan sizes.
Borrowers with more than five years of bureau vintage received an average loan of ₹31,007, compared with ₹6,857 for those having less than one year of bureau vintage.
Digital Personal Loans Are Moving Towards Higher Ticket Sizes
Although smaller loans continue to dominate digital lending volumes, the average ticket size is gradually increasing. The average digital NBFC loan rose by about 15% from FY25-26 to ₹18,802 in Q1 FY26-27.
Sanction value grew 50% year-on-year during the quarter, while the number of loans sanctioned increased by 14%.
The data points to two distinct patterns in India’s personal loan market. Digital NBFCs are driving a much larger number of transactions through smaller-value loans, whereas banks account for a substantially higher share of total lending value because of their significantly larger average ticket sizes.
Disclaimer
This article is based on data cited from the Fintech Association for Consumer Empowerment (FACE) and CRIF High Mark for Q1 FY26-27. The figures are provided for informational purposes and may be revised or updated by the respective data providers. Readers should verify the latest information before making financial or borrowing decisions.