Transunion Insights 1695098999

Research report by: With insights from:
The Rise and

Evolution of India’s
Digital Finance
Prologue
This research report, developed by TransUnion CIBIL with data

insights from NPCI and FCC, explores the profound impact of
digitalization on India's financial services industry. It focuses on
the transformative effects of digitalization of credit and
payments on the evolving consumer behaviors. Within this
research, we do not delve into any other segments of digital
finance, outside of lending and payments.
This research touches upon the pace of internet adoption and

smartphone penetration in India, coupled with the modernization
of country's digital infrastructure, which has fueled the uptake of
digital finance. Further, the advent of UPI has ignited a digital
revolution and transformed India’s digital payments landscape
positioning India as a global leader in this domain.
We uncover key themes that address the rising scale of digital

financial services, the permeating of digital credit and payments
in everyday needs, the shifts in consumer behaviors due to
digital convenience driving repeat consumption along with
inclusion and expansion opportunities for India. We also touch
upon how FinTech lenders have managed risk and the need for
sharper portfolio and collections management for prudent
growth. Through these comprehensive topics, we paint a vivid
picture of India's digitalization journey and its undeniable impact
on consumers’ interaction with financial services.
© 2023 TransUnion CIBIL All Rights Reserved

Contents
→ Preamble
1. India’s rapid
digitalization story
2. State of the Indian
FinTech ecosystem
→ Key themes
1. Rising scale of digital finance
2. Digital finance permeating
everyday use-cases
3. Consumer behavioral shifts
in digital finance
4. Accelerated inclusion and
future runway for growth

Preamble - Topic 1
Rapid
digitalization
in India
A Game Changer
1
India has emerged as the global leader in the
creation and adoption of digital infrastructure
1.3 billion 74 billion 28 billion app 1.2 billion 759 million 667 million+ 531 million
people enrolled in UPI transactions in downloads in wireless Active smartphones net-commerce
Aadhaar - world’s 2022 – highest 2022 - 5% of phone Internet users in 2022. Over # users in 2022
largest unique volumes of digital total global subscribers – in 2022 – 53% 1/3rd of – 258 million
digital identity payments2 app 45% in rural in rural India5 Indians own a shopped online7
program1 downloads3 India4 smartphone6
India No.1 globally India No.2 globally
# Net Commerce are internet users who have done any online transactions (bill payment, food ordering, online shopping, cab booking, travel ticket booking, etc.)
in the last 1 year Online Shopping is a subset of Net Commerce users and are the group of people who have shopped online in the last 1 year
Source: 1. Economic Survey 2023 | 2. NPCI | 3. State of Mobile 2023 by Data.ai | 4. Telecom Regulatory Authority of India
5. Kantar IAMAI 2023 | 6. Nielsen's India Internet Report 2023 | 7. Kantar IAMAI 2023
2
Confluence of mega trends has
accelerated shift to digital
1 Rise in digital penetration
2 Large young population
3 Increasing per capita income
3
Digital adoption fuelling the economy - Social
networking driving e-commerce
₹13/-$0.16
Lowest cost per GB
531 M
Social media users
of mobile internet
data in the world
77 M 36%
Increase vs last year
Shopping through
in Indians shopping
Online Social
through social
Platforms
platforms
Source: IAMAI Kantar 2023

$1 = ₹83
4
Active internet users largely spend
time on a few activities
Entertainment, Communication and Social Media are the top most activities done online.
Net Commerce are internet Online Shopping is a

users who have done any online subset of Net Commerce
transactions (bill payment, food users and are the group of
85% ordering, online shopping, cab people who have shopped
77% booking, travel ticket booking, online in the last 1 year.
70% etc.) in the last 1 year.
52%
34%
Entertainment Communication Social Media Net Commerce Online Shopping
Source: IAMAI Kantar 2023

5
Exponential Rise in Digital Payments
9.3 B
Number of transactions
36%
Digital Payments users
in June 2023 from Rural India
₹14.75 T$177.7 B
Value of transactions
in June 2023
Source: National Payments Corporation of India; IAMAI Kantar 2023

$1 = ₹83
6
Rural India is rising in digital payments
and social media usage
36%
of Digital Payments
users hail from
Rural India
56%
of total new internet
users in India will be
from Rural India
by 2025
Source: National Payments Corporation of India; IAMAI Kantar 2023

7
8
Large young workforce becoming
financially influential
52%
of India’s population is
2x
Growth in individual
under 40 years of age, EPFO accounts in
higher than global 10 years
average of 46%
20+ M
out of total 67 M
ITRs in FY 22-23
filed by Gen Z
Source: Ministry of Finance, Reserve Bank of India, EPFO

9
10
Rebound in domestic consumption set to drive
India's economic growth forward
58%
of GDP is Private
100%+
growth in Per
Consumption in Q2 Capita Net
FY 2022-23. National Income in
Highest in Q2, 10 years
across 10 years
6.9%
GDP growth in
1.6x
Rise in Per Capita
FY 2023-24 Income in 10 years
Source: Ministry of Finance, Reserve Bank of India, EPFO

11
The India Story - Set for further acceleration
Financially Influential Robust Digital Boost in

Young Workforce Infrastructure Digital Economy
Source: TransUnion CIBIL

12
Preamble - Topic 2
State of
the Indian
FinTech
Ecosystem
13
India's FinTech Ecosystem - Three key growth
driver have helped build a robust digital foundation
2019 - 2023
Government Interventions for Digitalization
Consumer Digitization and Reach

2015 - 2018 Scale in UPI and Digital
Evolution in Digital Finance Credit (Pre-COVID)
Cheapest ever data

2011 - 2014 plans launched driving Initial disruption and
internet penetration rapid rebound in
credit and eCommerce
during COVID
2007 - 2009 4G network released
Launch of UPI Small ticket Credit,
BNPL for eCommerce
and UPI scale and
Smart Phone become mainstream
adoptions starts Entry of Payment
Shift to digital
Fintechs
payments due to Digital Lending
Demonetization Guidelines
Mobile banking
launched Entry of FinTech
Open Banking
Lending startups
Regulations
(NBFC AA)
AADHAR Biometric
National Identity Entry of MSME
FinTech

14
India 3rd largest ecosystem globally
Top 20 countries home to over 50%
active FinTechs globally
USA - 5730 UK - 2439 INDIA - 1512
CANADA - 1376 GERMANY - 978 SPAIN - 977 FRANCE - 903 BRAZIL - 869 MEXICO - 844 SINGAPORE - 696 AUSTRALIA - 693 COLOMBIA - 642
SWITZERLAND - 599 NETHERLANDS - 572 ISRAEL - 496 ARGENTINA - 452 ITALY - 378 SWEDEN - 365 CHILE - 361 ESTONIA - 310
*Home grown active FinTechs

Source: Finnovating, Pitchbook
15
Indian FinTech Ecosystem Evolution Stages
Launch and Test
2012 – 2015
• Primarily digital payments and marketplace aggregation players

• Largely lift and shift models from mature markets; lower innovation
• Seed stage VC FinTech funding deals take-off
Innovation-led Differentiation and Diversification

2016 – 2019
• Launch of digital lending & UPI based payments; low scale

• Focus on penetrating the unserved and underserved population
• Innovative products made for Bharat & rapid business model pivots
• Accelerated growth-stage VC funding with lower diligence
Covid Impact, Rebound and Maturity

2020 – Present
• Covid led steep degrowth of credit; high collections and

profitability focus
• Strong rebound in volumes post unlocking, due to
increased digitization
• Rise of consumption-led demand and embedded
financial products
• Higher regulatory scrutiny and release of Digital Lending
regulations
• Funding crunch and focus on strong basics (profitability and
book quality)

16
Digital Online Personal Loans Online PoS Lending SME Lending Aggregators
Payments and TechFins
Wealth Tech
Consumer Internet
e-Commerce and
Neo Banking
India Is A Burgeoning
FinTech Market
1500+ FinTechs
Illustrative View Only 450+ in LendingTech
130+ FinTech Lenders Analyzed 17
FinTech Lender (Digital Lending) Defined
This research analyzes the on-book lending over the last 5 years,
for a cohort of over 130 credit institutions (NBFCs) hereinafter
collectively referred to as ‘FinTechs’
Have a ‘digital first’ approach to its business and operations
Abundantly use of cutting edge technology to offer financial

services through a differentiated experience across:
• Consumer application journeys and acquisition
• KYC, identity and eligibility checks
• Underwriting and issuances
• Cross-Sell, Upsell and Collections
Rapidly experiment and innovate to evolve and

scale faster
• Spurt globally in the last 2 decades, post global
financial crisis 2008
• FinTech regulations evolving globally with increased
recent focus

18
Digital Credit
and Payments
Key Trends
19
1 2
Rising scale of Digital finance permeating

digital finance everyday use-cases
3 4
Consumer behavioral Accelerated inclusion

shifts in digital finance and future runway for growth
20
© 2023 TransUnion
© 2023 TransUnion CIBIL
CIBIL AllAll Rights
Rights Reserved
Reserved
Key themes - Topic 1
Rising scale of
digital finance
21
Indian retail
credit industry
and UPI payments
have seen
unprecedented
growth in the
last 5 years
22
Indian retail credit industry
growth trajectory
The industry has almost doubled in the last 5 years Unsecured Loans have been growing the fastest
FY 2018-19 FY 2022-23 Live Retail Portfolio View (31st Mar ‘23)

+14% 45%
₹51.33 T CAGR ₹88.01 T
$0.618 T $1.06 T
40%
Live Portfolio Live Portfolio Personal Loans: `10.25T
Balance
1.7X Balance
35%
Gold Loans: `2.36T

30%
4 yr CAGR (number of loans)

Business Loans: `3.76T
Rise in Live Retail Portfolio
25%
Credit Cards: `2.10T
20%
+16% LAP: `7.34T
Consumer Durable Loans: `0.53T
207 M CAGR 370 M 15% Commercial Vehicle
Live Loans Live Loans Loans: `3.08T
Two Wheeler Loans: `0.94T
1.8X 10%
Commercial Equipment
Loans: `0.79T Home Loans: `29.21T
5%
Education Loans: `1.21T Auto Loans: `6.14T
Rise in Live Retail Loans 0%
0 10 20 30 40 50 60 70 80
Live Retail Loans (M)
Source: TransUnion CIBIL *Size of bubble indicates outstanding balance in INR

Unsecured Loans
23
© 2023 TransUnion CIBIL All Rights Reserved Secured Loans
Indian UPI growth story over the last 5 years
UPI payments has grown 15x+ in the last 5 years
+100%
FY 2018-19 FY 2022-23 Volume in Billions Value in ` Trillions
CAGR
160.0
UPI growth trends 160.0
`8.8 T `139.2 T
16X
$0.11 T $1.68 T 140.0 139.2 140.0
UPI transaction UPI transaction

120.0 120.0
value value
100.0 100.0
Rise in UPI transaction Value
84.2 83.8
80.0 80.0
60.0 60.0
+99%
CAGR
46.0
40.0 41.0 40.0
15.5X
5.4 B 83.8 B 20.0
8.8
21.3 22.3 20.0
12.5
UPI transaction UPI transaction 0.0 5.4 0.0
volume volume 2018-19 2019-20 2020-21 2021-22 2022-23
Sum of Volume (in Billion) Sum of Value
Rise in UPI transaction volume (in ` Trillion)
91 4X Growth 399
UPI = Unified Payments Interface Banks Live on UPI Banks Live on UPI
Mar - 18 Mar -23
Source: National Payments Corporation of India
24
FinTechs have
catered to
consumption
needs and have
driven overall
retail credit
volumes
25
Indian FinTech Lending Industry Snapshot
FinTech Originations by Value
in FY 2022-23
10.61%
Originated Amount Originated Loans Personal Loans
13.95%
in FY 2022-23 in FY 2022-23
64.5%
Consumer Loans
Business Loans
`1,107 B 79 M
Other Loans
10.95%
($13.3 B)
FinTech Portfolio Value

as on Mar’23
Current Portfolio Live Loans 15.8%
as on March-23 as on March-23
Personal Loans
`645 B 24 M Consumer Loans
54.2%
23.4%
Business Loans
($7.9 B) Other Loans
6.5%

26
FinTechs cater to consumption needs through
Personal and Consumer Loans
Origination Distribution by Lender Type (FY 2022-23)
2%
1%
13%
Other Loans
% of Accounts
55%
58% Business Loans
1% 89%
Consumer Durable Loans
84% 31% Personal Loans

20%
1%
< 1%
13% 21%
10%
FinTech Lenders NBFC Lenders Private Banks Public Sector Bank

27
FinTech Lenders have emerged as the volume driver
in the overall consumption lending market
Consumption Loans Consumption Loans
Total Retail Loans
(All Lenders) (FinTech)
+25% +30% +98%
CAGR CAGR CAGR
2.4x `28 T
Originated in
`55 T 2.9x `5 T `11 T 15x `0.07 T `0.84 T
Originated in Originated in Originated in Originated in Originated in
FY 2018-19 FY 2022-23 FY 2018-19 FY 2022-23 Rise in Origination FY 2018-19 FY 2022-23
Rise in Origination Rise in Origination
Volumes Volumes Volumes
35
30
No. of Loans Originated (M)
25
COVID-19 All other loans 45%

20
Wave 1 Wave 2
15
10 Consumption loans (Other lenders) 33%
Consumption loans (FinTech) 22%

-
FY 2018-19 FY 2019-20 FY 2020-21 FY 2021-22 FY 2022-23
Consumption Loans = Personal Loans, Consumer Durable Loans and Credit Cards
Loan Originated = Loan Disbursed

28
High focus on consumption lending has
empowered FinTechs to scale faster than
any other lender in this segment
Number of Other Lenders Number of FinTech Lenders
FY 2018-19 vs FY 2022-23 FY 2018-19 vs FY 2022-23
Consumption Loans
Growth of FinTechs operating at scale
104 119 > 5K Loans 24 54

2.1x 33 70
31 44 > 100K Loans 6 36 No of No of
FinTechs in FinTechs in
FY 2018-19 FY 2022-23
11 20 > 1M Loans 1 12 Lenders at Scale = With >5K Originations
6 41 3
New lenders have catapulted to the FinTechs disbursed 10 times Lenders are consistently in
list of Top 10 FinTech originators higher consumption loans the Top 10 consumption
of consumption loans in in FY 2022-23 vs. FY 2018-19 loans originating FinTechs
FY 2022-23 vs. FY 2018-19
Consumption Loans = Personal Loans, Consumer Durable Loans and Credit Cards
29
Led by rising
consumption,
digital finance
is permeating
everyday
use-cases
30
2
Digital credit and payments are embedded across
online shopping and purchase journeys
Payment Methods Payment Methods
Payment Methods

31
2
©
© 2023
2023 TransUnion
TransUnion CIBIL
CIBIL All
All Rights
Rights Reserved
Reserved
FinTech NBFCs continue to have higher lending
to smaller tickets; however, there is
a clear upward shift
Personal Loan: FinTech Origination by Trade Size
100%
90%
<10K
8%
3%
10K-25K
9%
1%
25K-50K
7%
2%
50K-1L
16%
3%
>1L
12%
4% 16%
FY 2018-19
80%
% of Accounts
70%
60%
21%
50%
89%
40% 84% 88%
78% 79%
30%
20% FY 2022-23
10% Increase in Share of
loans with Average
0% Ticket Size above 10K
FY 2018-19 FY 2019-20 FY 2020-21 FY 2021-22 FY 2022-23
Higher profitability focus and launch of adjacent higher ticket loans for up-sell by
FinTechs, has improved the product mix and average ticket-sizes in the last 24 months

32
2
©
© 2023
2023 TransUnion
TransUnion CIBIL
CIBIL All
All Rights
Rights Reserved
Reserved
FinTech NBFCs provide superior speed and
convenience in consumer loans
% Applications Processed Same Day (FY 2022 - 23)
FinTech NBFC Lenders Private Banks PSU
80%
70%
% of Accounts
60% 57%
40%
20%
3%
0%
Personal Loan Consumer Durable Loan Business Loan
High digitization in application journeys, KYC check,

identity and risk checks with automated scorecards have enabled this speed.

33
Same day onboarding has increased at FinTechs
due to Digitalization
Personal Loan Applications Consumer Durable Loan Applications
Same day 1-2 days 3-5 days 6-10 days >10 days Same day 1-2 days 3-5 days 6-10 days >10 days
FinTech
Lenders
70%
52% 57%
34% 37%
14%
FY 2018-19 FY 2021-22 FY 2022-23 FY 2018-19 FY 2021-22 FY 2022-23
Other
Lenders 33% 35%
31% 31% 20%
22%
Consistent investment in technology and use of data and analytics by FinTechs has enabled
improvements in speed and consumer experience levels over the years

34
UPI transaction volume for P2M surpassed P2P
in FY 2022-23 for the first time ever, indicating
rise in usage for everyday consumption
Share of UPI transaction volume Share of UPI transaction value
FY 2021-22 vs. FY 2022-23 (in Billion) FY 21-22 vs. FY 22-23 (in ₹ Trillion)
FY 2022-23 FY 2022-23
P2M
P2M 22%
51%
FY 2021-22
FY 2021-22
P2M
42%
1.8x Total UPI Volume
83.8 B
P2M
19%
1.6x Total UPI Value
₹139.2 T
46 B
transactions Rise in P2M UPI P2P Rise in P2M UPI
Total UPI Value
transaction Volume 49% ₹84.2 T transaction value P2P
P2P P2M P2P P2M 78%
P2P P2P
58% 81%
P2P P2M
P2M = Payment to Merchants

P2P = Payment to another individual

2 35
©
© 2023
2023 TransUnion
TransUnion CIBIL
CIBIL All
All Rights
Rights Reserved
Reserved
UPI adoption is across popular everyday
payment use-cases, which has laid the foundation
for extending embedded credit via Credit on UPI
High UPI Volume Categories (Mar’ 23) Medium UPI Volume Categories (Mar ’23) Other UPI Volume Categories (Mar ’23)
• Groceries and supermarkets • Dairies • Professional services
• Eating places and restaurants • Utilities electric, gas, water and sanitary • Electronics shops
• Telecommunication services • Miscellaneous personal services • Online Marketplaces
• Fast food restaurants • Drinking places - alcoholic beverages • Securities brokers and dealers
• Digital Goods: Games • Debt collection agencies • Cable and other pay television
• Department stores • Miscellaneous general merchandise • Candy, nut and confectionery
• Service stations • Variety stores • Beauty and barber shops
• Drug stores and pharmacies • Financial institutions merchandise • Government services
• Bakeries • Men, women and children’s uniforms • Motor freight carriers and trucking
• Debit card to wallet credit • Freezer and locker meat provisioners

36
Behavioral shifts
accelerated
by digital
convenience
37
Fintech Lenders attract younger borrowers,
more than any other lender type –
Gen Z and Young Millennials are digital natives
PVT Banks,
PVT Banks 26%
25%
PVT
Banks,
PVT NBFC, 28% 28%
NBFC, 33%
Banks, NBFC,
26% PSU Banks, FY 2018-19 FY 2022-23 PSU Banks,
NBFC, FY 2022-23 7%
44%
PSU 10%
45% FY 2018-19 Banks,
PSU Others, 16%
Banks 4% Others, 6%
Others,
15% FinTech, 8%
Others, 5%
FinTech, 5% FinTech
FinTech,
9% 25%
36%
Consumers of age less than 25 years Consumers of age between 26 and 30 years

38
Younger borrowers are taking more loans
from FinTech lenders
Average loans per borrower - Overall Frequency of Credit
Borrowers Consumers originating trade with FinTech
1.7
< 25 Yrs and has 3+ Trades Opened in last 6 months
1.2 1.4
Loans Loans Loans 21% <25 52%
in FY 2018-19 in FY 2022-23 years
in FY 2022-23 21% 35 - 45 42%

years
11% 55+ 20%

years
in FY 2018-19 in FY 2022-23
Average loans per borrower - Consumption Loans
Borrowers
Average loans per borrower - Personal Loans
1.4 1.5 1.8
< 25 Yrs
Borrowers
Loans Loans 1.8 1.9
< 25 Yrs
in FY 2018-19 in FY 2022-23
Loans
Loans Loans
2.2
in FY 2022-23 in FY 2018-19 in FY 2022-23
Loans
in FY 2022-23
39
FinTechs provide super consumer experience and
convenience, which leads to high levels of loyalty
Cohort loyalty - Next Loan Lender loyalty - Next Loan
from any FinTech from same FinTech
19%
35%
All Loans All Loans
28%
49%
Personal Personal
Loans Loans
Loyalty measured for subsequent loan in next 12 months for loans originated by Fintech from July'21 to Dec'21

40
FinTechs have gradually started focusing and
attracting business from more Prime and Super Prime
Consumers over the years
Rising Share of Prime Consumers choosing FinTech
2.3x
35%
30% 6%
Rise in number of originations of

25% 6% Prime Consumers in FinTech
9%
20%
8%
5%
15%
50%
2%
3% 6%
10%
18%
14%
5% 1% 10%
9% of all FinTech consumers have a
1%
credit footprint of 2 years or more
3%
0%
FY 2018-19 FY 2019-20 FY 2020-21 FY 2021-22 FY 2022-23
Prime Prime Plus Super Prime
CreditVision (CV) score ranges are: Prime = 731-770; Prime Plus = 771-790; Super Prime = 791-900

41
As growth continues, there is need for close
Portfolio and risk monitoring to
ensure sustained long-term growth
Balance Level – 90+ Delinquency FinTech Tier wise Balance level 90+ delinquency
% of Consumers
FinTech Others
6%
3% 3%
4%
2% 2%
1.30% 2%
BUSINESS LOAN 0%
3.60% Metro Urban Semi-Urban Rural
2.80%
CONSUMER LOAN
1.40% FinTech Age wise Balance level 90+ delinquency
% of Consumers
3.20%
PERSONAL LOAN 6% 5%
0.90% 3%
4%
2% 1%
2%
0%
<25 26-35 36-45 >45

42
Accelerated
inclusion and
future runway
for growth
43
FinTech Lenders have diversified from a largely urban
to a geographically well diversified play in just 5 Years
FinTech Originations
Metro & Urban Semi Urban & Rural
36%
51%
% of Consumers
64%
49%
FY 2018-19 FY 2022-23 107% CAGR
Semi Urban and Rural

FY 2022-23 vs. FY 2018-19

44
Digital and information-oriented lending is fueling
strong growth across States
6 Indian states witness 100%+ 4 year CAGR in FinTech Loan Count�Bihar, UP, AP, WB lead the Loan Amount
growth story�
Uttar Pradesh (₹98B)

125%
115% Rajasthan (₹57B) West Bengal (₹40B)

Bihar (₹35B)
4 year CAGR in Count
105% Madhya Pradesh (₹35B)

Tamil
Nadu Gujarat (₹61B)
95%
(₹91B)
85% Andhra Pradesh (₹62B)
75%
Karnataka (₹134B)
65%
Telangana (₹99B)
55%
45%
45% 55% 65% 75% 85% 95% 105% 115%
4 year CAGR in Amount
Size of the bubble represents the Origination Value FY 2022-23

CAGR is FY 2022-23 vs. FY 2018-19
45
Growth and risk differ across States significantly
hence it is important to consider granular strategies
Maharashtra | CAGR by Value 50%
Uttar Pradesh | CAGR by Value 67%
Value Volume Value Volume
Product Product
CAGR CAGR CAGR CAGR
Telangana | CAGR by Value 60%
PL 96% 108% PL 119% 118%
Value Volume
CDL 35% 61% CDL 77% 123% Product
CAGR CAGR
BL 9% 31% BL 23% 23%
PL 94% 74%
CDL 28% 45%
Karnataka | CAGR by Value 52% BL 8% 25%
Value Volume
Product
CAGR CAGR
Tamil Nadu | CAGR by Value 51%
PL 91% 94%
Value Volume
CDL 24% 43% Product
CAGR CAGR
BL 8% 18% PL 102% 107%
CDL 22% 53%
BL 7% 24%
CAGR is FY 2022-23 vs. FY 2018-19

46
49% of overall FinTech NTC originations
originations are coming from help drive growth
5 States in these states
Fintech lenders Other Lenders

Uttar Pradesh 17% 15%
Maharashtra 12% 12%
Karnataka 8% 8%
UP, 9%
Bihar 8% 7%
Rajasthan 6% 6%
Tamil Nadu 5% 6%
Maharashtra, 14%
West Bengal 4% 6%
Telangana, 8% Share of NTC originations
Karnataka, 11%
TN, 7%
Share of originations

47
FinTech Lenders continue to originate large
population of first time borrowers, however the
proportion of this segment has reduced
NTC Origination by FinTech Lenders 56%
8 50%
CAGR
7 45%
6
7.36
40%
35%
1.25M 7.3M
5 29% NTC Consumers NTC Consumers
30%
in FY 2018-19 in FY 2022-23
4 25%
22% 4.72
20% 20%
3
29% 13%
14% 15%
2 4.49 3.04 13%
10%
1 5% NTC Origination NTC Origination
1.25
0 0% share in FY 2018-19 share in FY 2022-23
FY 2018-19 FY 2019-20 FY 2020-21 FY 2021-22 FY 2022-23
NTC Consumers in M NTC Share

48
Consumption led demand for credit for younger
consumers is serviced largely by FinTechs Gen Z
Young Millennials are digital natives
Share of originations
<25 years
26-30 years
31-40 years
41-45 years
32%
46+ years
29% FY 2022-23
27%

49
Increase of Female borrowers
Majority continues to be Male
Others
e
al
+2% m %
Fe 14
FY 2022-23
Male 83%
Share shift in percentage points in women

borrowers compared to FY 2018-19

50
FinTech borrowers have shorter
loan terms
> 6 Month
27%
FY 2022-23
73%
<= 6 Months
The share of loans close in <=6 months has dropped

from 87% in FY 2018-19 to 73% in FY 2022-23 attributed
to changes in consumer behaviour

51
Suggestions for FinTech Growth
Innovation centered around emerging consumer needs is a force multiplier
• New credit product constructs across use-cases, tenures and ticket-sizes
• Tailored products and journeys for niche demographics & geographies
• Embedding at the point-of-sale (online & offline) brings scale to consumer uptake
• Enables businesses to occupy consumer mind-share, causing rapid share-shift
• Diversity in the product mix and unlock margins & loyalty through cross-sell
Ecosystem collaboration is essential
• Banks and other Credit Institutions for cross-sell, off-book lending & compliance
• eCommerce platforms and offline merchants for reach & scale
Regulatory compliance by design
• Disclosures and compliance at the core of every business model pivot or
product launch
• Creates high trust with Consumers, Regulators & the Ecosystem
Robust risk management to unlock positive unit economics & profitability
• Sharp underwriting using new-age information assets/scores & fraud
prevention solutions
• Analytics-led portfolio management as well as digitalization in
Collections processes
Data contribution essential for prudent growth of the ecosystem
• Need for industry contribution on data assets on sourcing Loan
Service Providers (LSPs)
• Higher frequency and quality of data reporting - Prevent info
asymmetry and loan stacking

52
The authors and contributors
If you would like to discuss the themes and content of this report, please contact:
Saurabh Sinha Neha Pandey

Vertical Head – FinTech and Lead – Marketing, NPCI
eCommerce, TransUnion CIBIL [email protected]
[email protected]
Sandeep Jhingran
Chief Growth Officer, IAMAI
[email protected]
Sharada Patil Lalita Nayak
Head of Research and Consulting, Incharge - Marketing, NPCI
TransUnion CIBIL [email protected]
[email protected]
53
Disclaimer
This Presentation is prepared by TransUnion CIBIL Limited (TU CIBIL). This Presentation is based on collation of information, substantially, provided by credit
institutions who are members with TU CIBIL. While TU CIBIL takes reasonable care in preparing the Presentation , TU CIBIL shall not be responsible for errors
and/or omissions caused by inaccurate or inadequate information submitted to it by credit institutions. Further, TU CIBIL does not guarantee the adequacy
or completeness of the information in the Presentation and/or its suitability for any specific purpose nor is TU CIBIL responsible for any access or reliance
on the Presentation and that TU CIBIL expressly disclaims all such liability. This Presentation is not a recommendation for rejection / denial or acceptance of
any application nor any recommendation by TU CIBIL to (i) lend or not to lend; (ii) enter into or not to enter into any financial transaction with the concerned
individual/entity. The user should carry out all the necessary analysis that is prudent in its opinion before making any decisions based on the Information
contained in this Presentation. The use of the Presentation is governed by the provisions of the Credit Information Companies (Regulation) Act, 2005, the
Credit Information Companies Regulations, 2006, Credit Information Companies Rules, 2006. No part of this presentation should be copied, circulated,
published without prior approvals.
TransUnion CIBIL Limited

19th Floor, Tower 2A-B, One World Center, Senapati Bapat Marg, Lower Parel, Mumbai, Maharashtra 400013.

Scan for a digital report
Research report by: With insights from:

Transunion Insights 1695098999

Uploaded by

Copyright:

Available Formats

Transunion Insights 1695098999

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Transunion Insights 1695098999

Uploaded by

Copyright:

Available Formats

Research report by: With insights from:

The Rise and

This research report, developed by TransUnion CIBIL with data

This research touches upon the pace of internet adoption and

We uncover key themes that address the rising scale of digital

© 2023 TransUnion CIBIL All Rights Reserved

© 2023 TransUnion CIBIL All Rights Reserved

India No.1 globally India No.2 globally

1 Rise in digital penetration

2 Large young population

3 Increasing per capita income

Source: IAMAI Kantar 2023

Net Commerce are internet Online Shopping is a

Entertainment Communication Social Media Net Commerce Online Shopping

Source: IAMAI Kantar 2023

Source: National Payments Corporation of India; IAMAI Kantar 2023

Source: National Payments Corporation of India; IAMAI Kantar 2023

1 Rise in digital penetration

2 Large young population

3 Increasing per capita income

Source: Ministry of Finance, Reserve Bank of India, EPFO

1 Rise in digital penetration

2 Large young population

3 Increasing per capita income

Source: Ministry of Finance, Reserve Bank of India, EPFO

Financially Influential Robust Digital Boost in

Source: TransUnion CIBIL

Consumer Digitization and Reach

Cheapest ever data

Source: TransUnion CIBIL

USA - 5730 UK - 2439 INDIA - 1512

*Home grown active FinTechs

• Primarily digital payments and marketplace aggregation players

Innovation-led Differentiation and Diversification

• Launch of digital lending & UPI based payments; low scale

Covid Impact, Rebound and Maturity

• Covid led steep degrowth of credit; high collections and

Source: TransUnion CIBIL

Have a ‘digital first’ approach to its business and operations

Abundantly use of cutting edge technology to offer financial

Rapidly experiment and innovate to evolve and

Source: TransUnion CIBIL

Rising scale of Digital finance permeating

Consumer behavioral Accelerated inclusion

FY 2018-19 FY 2022-23 Live Retail Portfolio View (31st Mar ‘23)

Gold Loans: `2.36T

4 yr CAGR (number of loans)

Education Loans: `1.21T Auto Loans: `6.14T

Rise in Live Retail Loans 0%

Live Retail Loans (M)

Source: TransUnion CIBIL *Size of bubble indicates outstanding balance in INR

UPI payments has grown 15x+ in the last 5 years

UPI transaction UPI transaction

Originated Amount Originated Loans Personal Loans

FinTech Portfolio Value

Current Portfolio Live Loans 15.8%

`645 B 24 M Consumer Loans

Source: TransUnion CIBIL