Credit Saison India is sharpening its strategy in the country's fast-growing MSME lending market by increasing the share of secured loans, a move that reflects both risk management discipline and a bid to deepen its reach beyond major urban centres. The company, which currently manages a loan book of Rs 25,000 crore, is targeting secured lending to make up 30% of its portfolio by the end of FY27, according to the company's stated expansion plans.
Secured Lending Shift
The decision marks a notable evolution in Credit Saison India's business model. For years, many non-bank lenders and fintech-backed credit platforms have leaned heavily on unsecured lending to capture growth quickly, especially in small business finance. But as credit conditions tighten and lenders become more selective, secured products are increasingly being viewed as a way to build resilience, improve asset quality and extend credit to borrowers who may not qualify for larger unsecured limits.
For Credit Saison India, the pivot is also about scale. MSMEs remain one of the largest unmet credit segments in the country, particularly in smaller towns where formal credit access is still uneven. By increasing secured lending, the company can potentially lend larger amounts against collateral while reducing credit risk, a combination that may prove especially useful in volatile operating environments.
Tier 2, Tier 3 Focus
The company's expansion strategy is centred on Tier 2 and Tier 3 towns, where demand for working capital, equipment finance and business expansion loans continues to rise. These markets are increasingly important for lenders seeking growth outside saturated metro corridors. They also tend to offer a more diversified borrower base, with businesses ranging from trading and manufacturing to services and local distribution.
Credit Saison India's emphasis on these geographies suggests a deliberate attempt to build a broader physical and relationship-led franchise. Opening more branches across the country would allow the lender to strengthen underwriting, improve borrower engagement and deepen sourcing in markets where local presence still matters. In MSME finance, branch networks remain valuable because many borrowers prefer in-person interactions, especially when applying for secured credit tied to property, machinery or other business assets.
The company's strategy also aligns with a wider trend in Indian lending: the push to combine technology-led origination with on-ground distribution. Lenders that can balance digital efficiency with local credit assessment are often better positioned to serve small businesses that have irregular cash flows but strong operating histories.
Growth With Guardrails
The move toward a higher secured-loan mix comes at a time when lenders across the sector are paying closer attention to portfolio quality. Secured lending can help cushion downside risk, particularly in segments where borrower incomes or business revenues may be cyclical. It can also support more sustainable growth if underwriting standards are maintained and collateral is properly valued.
At the same time, the shift is not without trade-offs. Secured loans can be slower to originate, require more documentation and depend on asset quality and enforceability. That means Credit Saison India will need to build operational depth as it expands, especially if it wants to scale branch-led lending without compromising turnaround times.
Still, the company's target of making secured loans 30% of the book by FY27 signals confidence in the opportunity ahead. With a Rs 25,000 crore loan book already in place, the lender appears to be positioning itself for a more balanced portfolio that can support growth in MSME finance while reducing dependence on higher-risk unsecured exposure.
For India's broader credit market, the move underscores a clear message: the next phase of lending growth may be less about speed alone and more about durability, distribution and disciplined risk selection. In that context, Credit Saison India's bet on secured MSME lending could become a template for how lenders pursue expansion in the country's smaller but increasingly important business centres.