ThePrint ·
Why Tier-2 and Tier-3 Cities Are Driving Growth in Personal Loan Demand
VMPL New Delhi [India], September 16: A textile trader in Surat needs stock money before the wedding season and has two days to arrange it. A family in Bhopal gets a hospital bill they did not plan for and would rather not break a fixed deposit to pay it. That is the shift worth paying […]
New Delhi [India], September 16: A textile trader in Surat needs stock money before the wedding season and has two days to arrange it. A family in Bhopal gets a hospital bill they did not plan for and would rather not break a fixed deposit to pay it. That is the shift worth paying attention to. The story of consumer credit in India is no longer being written only in Mumbai and Bengaluru. It is being written in Surat, Bhopal, Coimbatore, Rajkot and a few hundred towns like them.
For a long time, borrowing outside the metros meant one of two things: a local moneylender, or putting up something you owned. Gold, mostly. Sometimes land. That has changed, and the reasons are not mysterious. Incomes have risen. Almost everyone has a smartphone. Banks and NBFCs can now verify a borrower’s finances in minutes instead of weeks, which is why personal loan instant approval in India is no longer a metro-only promise. So the shop owner, the schoolteacher and the long-time gold loan customer are all doing something new: using formal, unsecured credit to fund growth rather than only to survive a crisis.
What Is Actually Driving Demand in Smaller Cities
