In the first half of 2026, first‑time borrowers accounted for 39% of new two‑wheeler loans, a sharp drop of 19 percentage points from pre‑pandemic levels. The decline in delinquencies to 1.4% in June 2026, the lowest in seven years, has been driven by a rise in consumption‑led credit products.
More than half of borrowers now have an established credit record, with 43% boasting over two years of formal credit history, up from 27% in 2019, while 18% still have less than two years. This shift signals a maturation of the borrower base.
Mobile‑phone EMIs account for a significant share of these histories, with 18% of borrowers holding a consumer durable loan and nearly a third holding other consumption credit products, up from 22% in 2019. Gold loans, credit cards and agriculture‑related credit also feature in a growing proportion of credit files.
Non‑bank finance companies hold 73% of the outstanding two‑wheeler loan balance, positioning them to capitalize on the trend. Their exposure to younger, credit‑history‑built borrowers will likely shape portfolio strategies.
Analysts predict lenders will broaden their two‑wheeler loan portfolios to capture the growing segment of younger borrowers with built credit histories, potentially tightening criteria to manage risk.