Vehicle financiers brace for a sluggish FY26

In The Slow Lane

- NARAYANAN V

THE COUNTRY'S LEADING NBFCs are bracing for another year of tepid growth in disbursements and assets under management (AUM), as their core lending segments—commercial and passenger vehicles—are projected to grow at a low single-digit pace in the current fiscal.

India's passenger vehicle (PV) segment grew at a modest 5% in FY25 to 4.2 million units, while commercial vehicle (CV) segment remained flat at 1.01 million units. According to the Federation of Automobile Dealers Associations (FADA), both these segments are expected to continue growing at a low single-digit rate in FY26 as well, amid subdued consumer demand, inventory overhang, and broader economic headwinds.