India, December XX 2022 – A new report by TransUnion CIBIL titled “CIBIL FOR EVERY INDIAN” released today provides a comprehensive insight into the credit behavior of self-monitoring consumers across India, including that the number of consumers monitoring their credit profile for the first time grew by 83% between October 2021 and September 2022. Since TransUnion CIBIL started its direct-to-consumer service in 2009, 61.1 million consumers have self-monitored their own credit profile. It also reveals that 23.8 million consumers registered for self-monitoring for the first time between October 2021 and September 2022, and that 71% (representing 16.8 million consumers) of this growth came from non-metro locations registering for the first time.
Commenting on the findings of the report, the Managing Director and CEO of TransUnion CIBIL, Mr. Rajesh Kumar, said, “With over 61.1 million self-monitoring1 consumers, we can see that Indians are beginning to take a more active role in monitoring their own credit information and understanding their credit health. The emergence of digitization, smartphones, and internet penetration into semi-urban and rural areas, have all improved access to credit exponentially.”
“The end consumer is the largest beneficiary of this evolution as the power is shifting to them as they are now able to access multiple financial opportunities at competitive terms, across the financial ecosystem. Improved consumer awareness bodes well for the market as it catalyzes competitive pricing of credit products and services by lenders, access to affordable credit opportunities for end consumers, and financial inclusion in the economy.” Mr. Kumar added.
The report shows that there has been a notable improvement in the ways Indians are monitoring their credit, especially those in non-metro locations who accounted for over 76% of the overall number of new-to-credit4 consumers between October 2021 and September 2022.
The TransUnion CIBIL data also shows positive results driven by younger consumers – evident through the 2.9X growth in Gen Z consumers monitoring their credit between October 2021 and September 2022, compared to the same period in the previous year. This is an indicator that more Indians are not only understanding credit management better, they are utilising it at a younger age.
Credit awareness directly proportional to credit discipline
The report finds that consumers are becoming more credit conscious, with results showing that nearly 47% improved their credit profiles (CIBIL Scores) within six months of checking their CIBIL Score and Report. Thirty-five percent of self-monitoring consumers opened a new credit line within three months of monitoring, compared to just 6.2% of non-monitoring consumers.
The report also shows that within three months of checking their score, 46% of self-monitoring consumers applied for new credit and 36% opened a new credit line. This suggests that there is a correlation between consumers monitoring their scores and an intent to purchase, with those consumers using their scores to avail lower interest rates, better offers or even a higher credit amount. Of the new accounts opened within three months of monitoring, 49% were personal loans, 14% were consumer loans, 9% were Gold Loans and 9% were Credit Cards.
Non-metros emerging as growing credit-active markets with year-over-year consumer growth of 71% in 2022
Showcasing the trend of increased credit-consciousness, the report highlights that 69% of the newly registered self-monitoring consumers with a CIBIL Score5 of 730+ (considered to be prime and above) between October 2021 and September 2022 were from non-metros. The report also shows that most new-to-credit consumers have come from non-metros over the last four years in India, with these areas being home to more than 76% of overall self-monitoring new-to-credit consumers between October 2021 and September 2022.
Source: TransUnion CIBIL database
Self-monitoring women borrowers from non-metro locations increasingly influencing the Indian credit landscape
The consumer credit market in India is evolving as more and more women borrowers take charge of their credit health. The period between October 2021 and September 2022 witnessed an 88% growth in the number of women self-monitoring compared to the previous 12 months. The report highlights 2.2X growth in number of self-monitoring women consumers with a score of 730+ between October 2021 and September 2022, compared to October 2021 to September 2022:
- Out of the women consumers who began monitoring their own profile between October 2021 and September 2022, 62% were from non-metro locations.
- With a 3.4X increase, Gen Z self-monitoring women have shown massive growth between October 2021 and September 2022, compared to the same period in the previous year.
Young Indians emerging as vigilant borrowers
Gen Z consumers have shown significant growth in their self-monitoring behavior over the last few years, representing 29% of new self-monitoring consumer between October 2021 and September 2022. The report shows that nearly 23.8 million Millennials3 began monitoring their credit profiles in this period, registering a growth of 83% compared to the same period in the previous year:
- There was a 2.9X growth in Gen Z consumers who actively monitored their credit profiles between October 2021 and September 2022
- Together, Millennials2 and Gen Z3 formed 94% of new-to-credit consumers between October 2021 and September 2022
“Our report insights show that emerging youth and women consumers from non-metro geographies are exhibiting increased credit consciousness. Providing access to credit opportunities for this consumer segment will be critical for furthering the consumption led growth of India’s economy,” concluded Mr. Kumar.
1Self-monitoring consumers are users who have proactively checked their CIBIL Score & Report at least once with TransUnion CIBIL.
2Gen Z are consumers born 1997 to 2012.
3Millennials are consumers born 1981 to 1996.
4New-to-credit – credit vintage up to 6 months
5 CIBIL Score ranges from 300-900. Score tiers are: subprime = 300-680, near prime = 681-730, prime = 731-770, prime plus = 771-790, and super prime = 791-900.