Credit card usage is no longer limited to major cities; young people from smaller towns and rural areas are now also entering this sphere. According to the TransUnion CIBIL report, by March 2026, half of the people who first obtained a credit card in India were under 30 years old, with 46% of them coming from small towns and rural areas.
The credit card market in India has expanded significantly over the last decade. If there were about 1.4 million credit card holders in March 2016, this number increased to 5.2 million by March 2026. Debt on cards also grew in parallel: if it was around 40 thousand crore rupees in 2016, it reached 3.1 lakh crore rupees by 2026. The number of active credit cards grew from 2.1 million to 10.7 million.
The study also showed that by March 2026, only 25% of the Indian population had credit cards, which is significantly lower than the figures for the UK (70%), Colombia (62%), and Hong Kong (98%), indicating significant potential for market growth.
The research found that many young people in India took other types of loans even before getting a credit card. Among Gen Z representatives aged 24 to 30 who first obtained a credit card in 2024, 31% already had at least two credit accounts, while only 30% had never used credit before. This contrasts with 2018 data, when 56% of millennials in this age group had no credit history before getting their first card.
According to the study, 18% of these young people who first got a credit card already had a consumer long-term loan, and 23% took out small personal loans. This suggests that for many young people, a credit card is not the beginning of borrowing but an additional tool supplementing existing loans.
The study showed that after obtaining their first credit card, Gen Z members started spending more and taking out loans faster. Approximately 28% of young people who first got a card had debt exceeding 25 thousand rupees within the first three months, compared to approximately 20% among millennials of the same age in 2018.
Furthermore, after getting a credit card, about 69% of young people in Gen Z utilized another credit product within 12 months, higher than the 55% rate for millennials. Of those who took out a second credit product, 39% did so with the same bank or creditor that issued their first card, whereas this figure was 33% for millennials.
Currently, the share of credit cards in total debt is decreasing because people are not relying solely on credit cards for funds but are using various types of credit products. In March 2016, the share of active credit cards in the total volume of credit accounts for expenses was 56%, but by March 2026, it dropped to 38%. Similarly, the share of credit card debt in the total debt decreased from 36% to 26%.
The number of people who use only credit cards for borrowing has also decreased: their share fell from 50% in March 2016 to 33% in March 2026. Conversely, the share of those who have other loans besides a credit card has increased, rising from 16% to 32%. Additionally, the number of people holding three or more credit cards is growing: their share increased from 12% to 22% over the last ten years.
Baves Jain, Managing Director and CEO of TransUnion CIBIL, noted that people are now using not only credit cards but also small personal loans, consumer long-term loans, and other short-term credit products, leading to changes in the credit market. He emphasized that loans should be granted considering a person's ability to repay the debt, their financial situation, and current expenses.
The inclusion of youth and customers from small towns into the credit market contributes to increasing the customer base for banks and lenders. However, the simultaneous use of multiple credit products requires people to carefully monitor their total debt. Proper use of a credit card helps build a credit history, but the inability to repay a large bill or taking out multiple loans without considering income and expenses can lead to a breakdown of the family budget. The role of lenders is to provide access to credit to as many people as possible while controlling their ability to service the debt.