India’s credit market is entering a historic transformation. With digital innovation, inclusive financial products, and new business models leading the way, the country is poised to unlock a $1 trillion opportunity by the end of this decade. The future of credit is being shaped by democratisation, rapid digital adoption, and the integration of cutting-edge technology.
Market Snapshots: Data and Momentum
- Credit Card Spends: In May 2025 alone, credit card spending touched ₹1.89 trillion, a 14.5% rise year-on-year. For FY25, total spends reached ₹21.16 lakh crore, backed by more than 111 million credit cards in circulation.
- UPI Dominance: UPI continues to lead digital payments, making up nearly 80% of digital retail payment volume. With the addition of UPI-credit card integrations, transaction volumes have doubled to ₹638 billion ($7.4 billion) in just the first seven months of FY25.
Private Credit Growth: Private credit markets attracted $9 billion in H1 2025, up 53% year-on-year. Assets under management surged to $25–30 billion, with infrastructure and real estate driving the bulk of investments.
India’s broader digital economy is on track to cross $1 trillion this decade. It is powered by deeper internet penetration, rising financial literacy, and technology-enabled financial services.
Drivers of Growth
- UPI–Credit Card Stacking: By linking credit cards to UPI, millions of “new-to-credit” consumers are gaining access to formal credit for the first time. This is democratizing credit at scale.
- Technology-Driven Lending: Platforms are harnessing alternative data, from payment histories to utility bills, to assess creditworthiness. This enables faster, more inclusive lending, particularly for the underbanked and MSMEs.
- Regulatory Push: The Reserve Bank of India and NPCI are championing innovation through supportive frameworks, improved security, and flexible product structures. It is opening doors to more accessible credit.
Trends Reshaping India’s Credit Future
- Shift from Debit to Credit: Consumers are gravitating toward UPI-linked credit cards and instant EMI options, drawn by rewards and convenience. Traditional debit card usage is steadily declining.
- Smarter Risk Assessment: Lenders are going beyond credit scores, using behavioral analytics—like UPI transactions or recurring bill payments—to better understand borrowers, expanding credit inclusion.
- MSME-Centric Lending: With MSMEs projected to contribute 40% of GDP in the next five years, tailored lending products for this sector are becoming essential growth engines.
The Road Ahead: Unlocking the $1 Trillion Potential
The real opportunity lies in reaching the next 100 million borrowers through:
- Embedded finance for seamless credit access.
- Faster onboarding processes.
- Contextual credit products built on robust digital infrastructure.
Private credit markets and fintech partnerships will continue bridging the gaps left by traditional lenders, accelerating support for infrastructure, energy, and real estate. As digital literacy deepens across India, credit access will extend into rural areas, empowering aspirations and driving economic momentum.
Kiwi’s Vision: Powering a Credit-First India
At Kiwi, we see this transformation as a turning point. By enabling credit cards on UPI, we’re not just simplifying payments—we’re creating a pathway for millions of Indians to access credit responsibly and build financial strength. The $1 trillion opportunity isn’t just about growth; it’s about inclusion, empowerment, and a stronger financial future for India.
Final Word
India’s credit ecosystem in 2025 is setting global benchmarks for digital-first growth, inclusivity, and innovation. With technology, policy, and consumer demand aligned, the next decade promises to unlock unprecedented opportunities for consumers, businesses, and investors. Kiwi is proud to be at the forefront of this journey.
