Fintechs hold steady in changing terrain

Unsecured credit business grows despite a shift in dynamics, reports Raghu Mohan

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Personal loans given by fintechs continue to grow.

Data from the Fintech Association for Consumer Empowerment (FACE) shows an expansion both in scale and value in the first half of FY26 over the same period in FY25. Volumes grew to 6.4 million (accounts) from 59 million; value was up at%97,381 crore (%78,084 crore); ticket sizes were higher at %15,177 (813,327).

‘The catalysts are “the positive regulatory landscape and digital public infrastructure. And that digital-first shadow banks have scaled credit and sustained growth by providing faster, cheaper and better customised loans,” according to Sugandh Saxena, chief executive officer (CEO) of FACE. The chief of the country’s first self-regulatory organisation for fintechs feels the importance of this space will get bigger down the line. She cites the ‘National Strategy for Financial Inclusion for 2025-30’ report released earlier this month. It recognised the role of small-value loans: “To strengthen financial resilience of people, suitable and fair credit products with easier documentation process and quick disbursals should be launched, especially for small-ticket loans.”

Funding declines

But there also appears to be a marked shift in the unsecured credit business dynamics. Take the matter of funding.

Data from Tracxn Technologies — a data intelligence platform for private market research — show fintechs’ equity funding continues to fall. A sum of $1.6 billion was raised in the first nine months of calendar year 2025, a drop of 17 per cent and 20 per cent compared to the $1.9 billion in the same period of CY2024 and $2 billion in CY2023.