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India's Loans Surge: Gold, Auto, Personal See Big Gains
24 Nov
Summary
- Retail loan growth hit 18% year-on-year in Q2 FY26.
- Gold loans led growth at 35.8% YoY, with high origination increases.
- PSU banks increased leadership in auto and personal loans.
India's retail lending sector demonstrated significant strength in the second quarter of fiscal year 2026, with overall loan outstandings climbing by 18% year-on-year and 4.5% sequentially. This expansion was primarily driven by a heightened demand for gold loans, auto loans, and a notable resurgence in personal loans and credit cards.
Gold loans emerged as the fastest-growing segment, boasting a 35.8% year-on-year increase in portfolio outstandings and a 53% rise in new originations. Auto loans also saw a strong uptake, growing 16.3% year-on-year, with PSU banks expanding their market share. Home loan originations rebounded sharply, increasing by 25% quarter-on-quarter, with a notable shift towards high-value loans.
Personal loan portfolios grew 12% year-on-year, and two-wheeler loans showed nearly 15% year-on-year growth. Consumer durable loans maintained strong year-on-year growth, while credit card delinquencies improved, indicating a stabilizing risk environment across the retail credit spectrum.
