Year Ender 2025: Young Borrowers Are Entering Into Credit Market Early to Buy Homes, Other Purchases

India's retail borrowers are changing how they use debt in 2025, with younger consumers driving a "2025 credit shift" towards early homeownership, safer credit cards and short-term personal loans, according to PB Fintech's year-end analysis of its Credit Score user base.

The report suggests a maturing "2025 credit shift" as borrowers show greater financial awareness. Consumers are using loans more deliberately, focusing on asset creation and liquidity management, rather than pure consumption. This is visible across housing loans, personal loans and credit cards, especially among under-30 borrowers.

Home loans and the 2025 credit shift among young borrowers

Housing finance data underlines how the "2025 credit shift" is supporting earlier asset creation. Overall home loans grew 12 percent year-on-year in 2025, while the share of new borrowers below 30 years rose to 16 percent, almost double the 9 percent recorded in 2022.

The average home loan size climbed from about Rs 29 lakh in 2022 to nearly Rs 37 lakh in 2025, reflecting higher property values and greater borrowing capacity. Joint ownership stayed dominant within this "2025 credit shift", forming 58 percent of home loans, compared with 42 percent taken in a single name.

Personal loans in the 2025 credit shift for liquidity needs

The "2025 credit shift" is also visible in personal loans, which rose 35 percent year-on-year in 2025, sharply higher than 9 percent growth a year earlier. Most of this came from short-tenure, small-ticket loans, which jumped 77 percent as borrowers sought quick liquidity rather than funding large purchases.

Salaried borrowers made up around 70 percent of personal loan disbursals across all categories within this "2025 credit shift". The top 10 metro cities contributed 34 percent of total disbursals, with Delhi and Mumbai leading the pack for personal credit demand.

Credit cards and the 2025 credit shift towards secured products

Credit card usage patterns reflect another layer of the "2025 credit shift", moving from spending-focused behaviour to structured credit building. Traditional unsecured retail card issuance fell 21 percent year-on-year in 2025, steeper than the 6 percent decline seen in the previous year.

At the same time, secured credit cards grew 62 percent in 2025 as first-time borrowers and lenders gravitated towards collateral-backed products. Many new users chose secured cards as an entry route to build credit history in this "2025 credit shift", encouraging lower-risk onboarding into formal credit.

Young participation in cards strengthened under the "2025 credit shift". Of all new cards, 34 percent went to customers under 30 years, while 9 percent were issued to those under 25, up from 3 percent in 2022. Delhi NCR and Mumbai remained key markets, contributing 11 percent and 6 percent of new cards respectively.