India's household debt rises to 41.3% of GDP, above 5-yr avg

India’s household debt climbed to 41.3 per cent of gross domestic product (GDP) at the end of March 2025, marking a sustained rise from its five-year average of 38.3 per cent, with consumption-related loans accounting for bulk of the borrowings, the Reserve Bank of India (RBI) said in its Financial Stability Report.

- ANUPREKSHA JAIN

However, the RBI noted that relative to most peer emerging market economies, India’s household debt remains lower. Among broad categories of household borrowings, non-housing retail loans extended mostly for consumption purposes continue to be the dominant segment. It accounted for 55.3 per cent of total household borrowings from financial institutions as of September 2025. This share has risen over the years, with growth consistently surpassing that of housing loans, and agriculture and business loans, RBI said.