Archive · 16 Dec 2025
Micro-LAP, small housing loans show stress in retail credit
In the last few months, most types of loans like home loans, personal loans, and credit cards have been doing well.
However, there are some problems with small housing loans and micro-LAP loans.
These loans are having more people who are late in paying them back.
This is because some people are borrowing too much money from different types of loans.
On the bright side, more people are asking for loans, especially for things like cars and home appliances.
But young people and new borrowers are not asking for as many loans.
Lenders are being careful and giving more loans to people who already have good credit.
Credit performance for most retail loan products remained stable in the September quarter, with improvements in home loans, personal loans, credit cards, and gold loans.
Micro-LAP and small-ticket housing loans showed stress, with early delinquencies increasing by 29 and 19 basis points respectively.
Overall retail credit demand improved, driven by festive-season buying and GST 2.0 implementation, with vehicle and consumer durable loans being key drivers.
Credit demand witnessed negative growth for young borrowers and flat growth for new-to-credit customers.
Lenders maintained a cautious stance, with originations driven by personal loans, consumer durable loans, and gold loans, and prime and above-prime borrowers accounting for 58% of all loan originations.
- Who
- TransUnion CIBIL
- What
- Micro-LAP and small-ticket housing loans show stress in retail credit
- When
- September quarter
- Where
- India
- Why
- Higher leveraging among borrowers with exposure to both secured and unsecured credit
- Credit Market Indicator (CMI) for performance
- Rose by 5 points in September quarter
- Early delinquencies in micro-LAP
- Increased by 29 basis points
- Early delinquencies in small-ticket housing loans
- Increased by 19 basis points
- Overall CMI in September
- 99
- Key drivers of retail credit demand
- Vehicle loans and consumer durable loans
- Credit demand growth for young borrowers
- Negative growth
- Growth in new-to-credit customers
- Flat
- Growth in credit-active consumers
- Slowed to 9% year-on-year
- Prime and above-prime borrowers
- 58% of all loan originations
