India's non-banking finance companies have emerged as the dominant gateway for first-time borrowers, accounting for half of all new-to-credit customers in June 2026, up from 24% in June 2016, according to a TransUnion CIBIL-FIDC report that analysed data from about 2,000 NBFCs.
The shift is significant because new-to-credit, or NTC, borrowers are typically individuals with no prior formal borrowing history. They are often younger consumers, first-time vehicle buyers, small business owners, gig workers or households entering the formal financial system for the first time. The report suggests that NBFCs have become central to this transition, filling gaps left by traditional lenders and expanding access to credit in segments that may be underserved by banks.
NBFCs Gain Ground
The rise in NBFC share reflects a broader structural change in India's credit market. Over the past decade, NBFCs have deepened their presence in consumer lending, vehicle finance, small-ticket loans and semi-urban and rural markets, where branch-led banking penetration can be thinner and underwriting models often need to be more flexible. Their ability to serve borrowers with limited or no credit history has made them especially relevant in sectors linked to mobility, including two-wheelers, passenger vehicles and electric vehicles.
For the automotive and mobility ecosystem, this trend matters because first-time borrowers are often the backbone of volume growth. A larger pool of NTC customers can support demand for entry-level vehicles, financing for used vehicles and adoption of newer mobility products, including EVs. In a market where affordability remains a decisive factor, NBFC-led lending can determine whether a purchase moves from interest to conversion.
The report also points to the growing sophistication of NBFC underwriting. Lenders are increasingly using alternative data, digital application flows and more granular customer segmentation to assess risk in borrowers who lack conventional bureau histories. That evolution has helped NBFCs widen their reach while maintaining scale across a diverse borrower base.
Credit Access Expands
The expansion of NTC lending through NBFCs has broader implications for financial inclusion. Bringing first-time borrowers into the formal credit system can help build credit histories, improve future access to loans and reduce dependence on informal borrowing channels. Over time, that can strengthen household resilience and support consumption-led growth.
At the same time, the trend carries risk. NTC borrowers are inherently harder to underwrite because there is limited historical repayment data. As NBFCs expand their footprint, the quality of credit appraisal, collection discipline and portfolio monitoring becomes more important. A rapid rise in first-time lending can create stress if growth outpaces risk controls, especially in segments exposed to income volatility or asset price swings.
The report's findings also come at a time when India's mobility market is undergoing change. Vehicle ownership aspirations remain strong, but buyers are increasingly sensitive to interest rates, down payments and monthly instalments. NBFCs, with their product flexibility and dealer relationships, are often better positioned than larger lenders to structure loans for customers at the edge of affordability.
For EVs in particular, financing remains a key adoption lever. While policy support and lower operating costs have improved the case for electric vehicles, upfront prices continue to challenge many buyers. If NBFCs continue to broaden access to first-time borrowers, they could play an outsized role in accelerating EV penetration across mass-market segments.
The TransUnion CIBIL-FIDC report therefore captures more than a lending statistic. It reflects how India's credit architecture is changing, with NBFCs increasingly acting as the bridge between excluded consumers and formal finance. For the automotive and mobility sectors, that bridge may prove decisive in determining who can buy, when they can buy and what kind of vehicle they can afford.