BHUBANESWAR: Women now account for around 26 per cent of India’s total credit system, with their outstanding portfolio expanding nearly five-fold — from ₹16 trillion in 2017 to ₹76 trillion in 2025, reveals a new report anchored by premier policy think tank Niti Aayog.
According to the joint report titled ‘From borrowers to builders – Women and India’s evolving credit market’ prepared by Niti Aayog, TransUnion CIBIL, and MicroSave Consulting, India’s credit ecosystem is undergoing a structural transformation, with women emerging as a key driver across retail and business lending segments.
The number of women borrowers has grown at a compound annual growth rate (CAGR) of 9 per cent between 2017 and 2025, bringing the total number of borrowers to around 16 crore. The credit penetration among women increased from 19 per cent to 36 per cent during the same period.
The credit growth of women has significantly outpaced the broader system, with overall credit expanding 2.9 times compared to 4.8 times growth in women’s credit portfolios, indicating a structural and sustained shift rather than a cyclical uptick.
“The increase reflects a broad-based expansion rather than growth concentrated in a narrow segment. While industry growth has moderated in recent cycles, new-to-credit women borrowers remain a structurally important opportunity to deepen inclusion and drive long-term portfolio expansion. Rapid digitisation of financial infrastructure and lending processes have lowered barriers to entry and enabled millions of women to access formal credit for the first time,” said the report.
A defining feature of this transformation, the Niti Aayog report indicated, is the rapid rise of women entrepreneurs. Business-purpose lending to women has seen the sharpest growth, with portfolio balances increasing 7.5 times since 2017 and the number of women availing such loans growing at a robust 31 per cent CAGR over the past three years.
There is a transition from consumption-led borrowing towards income-generating credit, reflecting improving financial capability and a stronger role in enterprise creation. However, access to more sophisticated financial products remains limited, with only about 4.3 per cent of women-owned enterprises currently using working capital facilities such as cash credit or overdraft, compared to a significantly higher share in the overall market.
According to the analysis of the women’s credit journey, digital public infrastructure has played a pivotal role in enabling the transformation. The widespread adoption of Aadhaar-based e-KYC, UPI payments, and paperless documentation has simplified onboarding and reduced turnaround times for loan approvals.
The creation of digital transaction trails has enabled lenders to adopt data-driven, flow-based underwriting models, especially for borrowers lacking formal collateral or income records. This has translated into faster credit delivery, with same-day approvals for consumption loans among women rising from 34 per cent in 2022 to 45 per cent in 2025, reflecting the growing efficiency of digital-first lending ecosystems.
UPI transaction value has surged from ₹920 million in FY2017–18 to ₹83.75 trillion in FY2022–23, reflecting a CAGR of 147 per cent. In the first four months of FY2024–25 alone, transaction value reached ₹80.79 trillion across 55.66 billion transactions. “This scale of adoption is creating a powerful digital footprint for millions of small businesses,” the report stated.
Even as microfinance continues to serve as a crucial entry point for women borrowers, particularly in low-income segments, the growth in this segment has moderated following a challenging 18 months of stress marked by over-leveraging and rising NPAs, prompting lenders to adopt a more cautious approach.
Source: Business Standard
