India's non-banking finance companies have emerged as a central gateway to formal credit for millions of first-time borrowers, with NBFCs now accounting for 50% of new-to-credit customers in June 2026, compared with 24% in June 2016, according to a TransUnion CIBIL-FIDC report released on the basis of data from about 2,000 NBFCs.
The shift is significant because new-to-credit, or NTC, borrowers are typically individuals with no prior borrowing history in the formal financial system. For lenders, they represent both a growth opportunity and a risk challenge: they expand the addressable market, but they also require more careful underwriting because conventional credit histories are limited or absent. The latest figures suggest that NBFCs have become the preferred channel for bringing these borrowers into the formal economy, particularly in segments where banks may be slower to lend or less present on the ground.
NBFCs Lead Credit Access
The rise in NBFC share reflects a broader structural change in India's credit landscape. Over the past decade, NBFCs have deepened their reach into smaller towns, semi-urban markets and underserved consumer segments, using more flexible distribution models and product designs tailored to borrowers with thin or no credit files. That has made them especially relevant in vehicle finance, two-wheeler lending, small-ticket consumer credit and other mobility-linked financing categories that often serve as a borrower's first formal credit relationship.
For the automotive and mobility sector, this trend matters because access to credit is often the deciding factor in vehicle purchases, especially in price-sensitive segments. A larger pool of NTC borrowers entering the system through NBFCs can support demand for entry-level vehicles, used vehicles and electric two-wheelers, where financing remains critical to adoption. The report therefore points to NBFCs not just as lenders, but as enablers of mobility consumption and broader economic participation.
Credit Growth, Risk Balance
The expansion of NTC lending also raises questions about credit quality and portfolio resilience. Borrowers without prior credit histories are harder to score using traditional models, which means NBFCs must rely on alternative data, field-level assessment and product-specific underwriting. That can help widen inclusion, but it also increases the importance of disciplined risk management, especially if economic conditions soften or repayment stress rises in lower-income borrower cohorts.
The TransUnion CIBIL-FIDC findings arrive at a time when India's formal credit ecosystem is increasingly data-driven and digitally distributed. Credit bureaus, lenders and fintech-linked channels are playing a larger role in identifying and serving first-time borrowers, while NBFCs continue to occupy a crucial position between mass-market demand and formal finance. The report's coverage of about 2,000 NBFCs gives the findings weight, suggesting the trend is not isolated to a handful of large lenders but is embedded across the sector.
The data also highlights how the credit market has evolved since 2016, when NBFCs accounted for less than one-quarter of NTC borrowers. The doubling of that share over a decade points to a sustained shift in lending patterns, with NBFCs increasingly shaping the first credit experience for households and small businesses alike. In practical terms, that first loan can determine whether a borrower later qualifies for larger-ticket finance, including cars, commercial vehicles or electric mobility products.
Mobility Finance Outlook
For India's automotive and EV ecosystem, the implications are immediate. Vehicle finance remains a core demand lever in a market where affordability is still a constraint for many buyers. If NBFCs continue to dominate the NTC segment, they are likely to remain influential in the pace of vehicle penetration, especially in lower-income and first-time buyer categories. That could prove particularly important for electric mobility, where financing structures are still adapting to new asset values, battery-related perceptions and resale uncertainty.
The report also reinforces the idea that credit inclusion is increasingly being driven by specialized lenders rather than only by large banks. As NBFCs expand their role, the quality of their underwriting, collection practices and customer acquisition models will become even more consequential for the health of the broader financial system. For now, the headline number is clear: NBFCs have become the dominant entry point into formal credit for India's new borrowers, and that makes them a key force in the country's next phase of consumer and mobility finance growth.