Younger Indians are reshaping the country's credit landscape by entering the financial ecosystem earlier and demonstrating a clear preference for secured, asset-backed products, according to PB Fintech 's comprehensive year-end analysis of its Credit Score consumer base. This shift represents a fundamental change in borrowing patterns and credit behavior among the younger demographic.

Home Loan Market Shows Strong Youth Participation

The housing finance sector experienced notable transformation in 2025, with younger borrowers driving significant growth. The data reveals compelling trends in both borrower demographics and loan characteristics:

This trend toward earlier homeownership stems from multiple factors including stable salaried incomes, the rise of dual-income households, and significantly improved access to credit facilities. Joint ownership arrangements continue to dominate the market, accounting for 58% of all home loans, indicating collaborative financial planning among younger couples and families.

Credit Card Preferences Shift Toward Security

The credit card market demonstrates a clear pivot toward secured products, reflecting more cautious and informed financial decision-making among younger consumers. Traditional unsecured credit card issuance declined 21% year-on-year, while secured credit cards experienced robust growth of 62%.

This preference for collateral-backed credit products enables younger borrowers to build safer credit histories while managing financial risk more effectively. Geographically, Delhi NCR leads the market with 11% of new card issuance, followed by Mumbai at 6%, highlighting the concentration of credit activity in major metropolitan areas.

Personal Loan Segment Records Strong Growth

Personal loans witnessed substantial expansion with 35% year-on-year growth, primarily driven by smaller, short-term loans that surged 77%. This growth pattern indicates a shift in borrowing behavior, with consumers increasingly using personal loans for short-term liquidity needs rather than long-term consumption purposes.

Salaried individuals account for approximately 70% of personal loan disbursals, reflecting stable income sources and improved creditworthiness assessment. The top 10 metropolitan cities contribute 34% of total personal loan volumes, with Delhi and Mumbai leading this segment as well.

Market Implications and Future Outlook

PB Fintech's analysis indicates a more informed and deliberate approach to credit management among younger Indians. The growing preference for secured and asset-backed products suggests potential benefits for both borrowers and the broader financial ecosystem. Industry experts believe this trend toward secured credit products may support healthier credit profiles and contribute to a more balanced retail credit ecosystem in the coming years, as younger borrowers demonstrate increased financial literacy and risk awareness in their credit decisions.

PB FinTech , operating the Policybazaar platform, has reported significant shifts in India's insurance sector, with consumers prioritizing comprehensive protection over basic compliance across health, life, motor, travel, and investment products. This trend represents a maturation of financial planning behavior, driven by increased awareness and digital accessibility.

Health Insurance Witnesses Unprecedented Growth

Health insurance emerged as the standout performer following GST exemption benefits. The sector recorded substantial improvements across coverage amounts and policy tenures, reflecting heightened consumer awareness about healthcare costs.

Consumers demonstrated preference for longer policy tenures, with four-year and five-year policies rising 56.00% and 62.00% respectively. This trend indicates growing confidence in insurance providers and recognition of long-term healthcare planning benefits.

Geographic and Demographic Shifts Reshape Market

The insurance market witnessed significant geographic redistribution, with smaller cities driving growth momentum.

Term Insurance Gains Strong Traction

Term insurance recorded robust 37.00% growth, primarily driven by buyers aged 25-40. The ₹1 crore sum assured category maintained its position as the most popular choice, while ₹2 crore-plus covers gained significant traction among higher-income segments.

Salaried individuals constituted 70.00% of term insurance purchases, with policy tenures concentrated around ages 60 and 70. This pattern reflects systematic financial planning aligned with retirement goals and family protection needs.

Motor Insurance Transformation Led by Electric Vehicles

The motor insurance segment experienced dramatic changes driven by electric vehicle adoption.

Pay-As-You-Drive plans gained momentum, with 15-20% of customers choosing usage-based policies, achieving premium savings of up to 30.00%.

Digital Payments Dominate Transaction Landscape

Digital payment adoption accelerated across all insurance segments, with UPI emerging as the dominant payment method.

Life insurance showed 94.00% monthly subscription adoption, while health insurance buyers balanced between annual payments (61.00%) and monthly payments (35.00%). UPI Autopay added 1.5 million new users, and approximately 500,000 customers experimented with buy-now-pay-later options.

Investment Behavior Shows Long-term Focus

Investment products witnessed strong millennial participation, with nearly 50.00% of purchases originating from individuals aged 31-40. Under-35 investors increased their share of retirement plans to 25.00%, up from 10.00% previously, indicating early financial planning awareness.

Guaranteed return plan buyers demonstrated long-term commitment, with eight out of ten opting for 20+ year tenures. Travel insurance became increasingly essential, with policy issuance rising 15.00% year-on-year and travelers choosing higher coverage amounts—$250,000 for most destinations and $500,000 for the US and Canada.