India’s retail credit landscape is undergoing a structural transformation, driven by rising consumer aspirations, growing demand for premium products and the
rapid adoption of digital-first lending models, according to trends observed by HDB Financial Services.
Consumers across categories are confident about discretionary spending, with a shift towards mid- to high-ticket purchases over entry-level options.
This trend of premiumisation is especially evident in consumer electronics, where demand for higher-value smartphones and devices continues to rise.
The growing preference for premium mobile phones reflects a broader socio-economic change, as aspirational consumption spreads beyond metropolitan cities into Tier 2 and Tier 3 markets.
Alongside this shift in consumption, lending practices are becoming overwhelmingly digital. Nearly 99% of loans are now processed through digital channels, significantly reducing turnaround times and limiting reliance on physical documentation.
Lenders are using bureau data, behavioural analytics and AI-driven credit scoring to enable faster decisions, sharper risk assessment and more personalised pricing, thereby widening access to credit.
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Geographically, credit growth is being powered by both established economic hubs and emerging consumption centres. States such as Uttar Pradesh, Tamil Nadu, Maharashtra, Rajasthan and Gujarat have emerged as key growth markets, while smaller centres including Betul, Hooghly and Alleppey are also contributing to demand.
Commenting on the trend, Karthik Srinivasan, Chief Business Officer at HDB Financial Services, said customers today are “more confident, digitally aware, and willing to invest in products that offer exceptional value across price ranges”, adding that the company is focused on delivering faster, simpler and more responsible credit solutions.
Seasonal demand for consumer durables remains strong, supported by the growing preference for quick and flexible digital credit across education, lifestyle and personal spending needs.
