Credit active1 women borrowers increased at a CAGR of 15% in the last five years
India, March 6, 2023: TransUnion CIBIL publishes its annual retail credit2 insights on women borrowers each year ahead of International Woman’s Day on 8 March, and its most recent analysis shows rapid growth in credit uptake by women across India’s rural and semi-urban geography. The TransUnion CIBIL insights show that women borrowers in India have increased at a compound annual growth rate (CAGR) of 15% over the last five years compared to a CAGR growth of 11% for male borrowers. The share of women borrowers has increased from 25% in 2017 to 28% in 2022.
India’s estimated population of 1.4* billion comprises approximately 454* million adult women of which only about 63 million are active borrowers as of CY 2022. Credit access for women (percentage of borrowers to total adult population) has grown from 7% in CY 2017 to 14% in CY 2022. With about 63 million credit active women borrowers as of December 2022, the growth rate of women borrowers (16%) has been more rapid than men (13%). This data emphasizes the huge potential for lenders to provide credit access to women across India, empowering them while driving financial inclusion.
Speaking on these insights, the Chief Operating Officer of TransUnion CIBIL, Ms. Harshala Chandorkar, said: “The marked evolution of women borrowers as active participants in India’s credit market bodes well for the government’s financial inclusion mandates that intend to improve access to financial opportunities for traditionally underserved segments such as women. Customised products for women borrowers across socio-economic categories, age-groups and geographic locations will further empower them to fulfill their aspirations and economic goals while catalysing steady portfolio growth for credit institutions.”
Further insights show that women borrowers have a better risk profile. In CY 2022, 57% of women borrowers had a score of prime3 and above compared to 51% of male borrowers. Insights on the type of credit products availed by women reveal that consumption-led credit products like personal loans and consumer durable loans are gaining popularity among women borrowers. As more women borrowers enter the workforce and become financially independent, they are seeking credit opportunities to fulfill their life goals and aspirations.
Insights also indicate that number of women seeking business loans have more than tripled in the last five years (CY 2017 to CY 2022) which is a reflection of the growth of women-led startups in India. During this period the share of women in over-all business loan portfolio has increased by twelve percentage points (32% in CY 2022 versus 20% in CY 2017). Increase in the share of women borrowers is also observed in the home loan segment, with 6% growth in the last 5 years.
Increasing footprint of women borrowers in semi-urban and rural locations.
TransUnion CIBIL insights also indicate expansion in the footprint of women borrowers in semi-urban and rural locations. The share of women borrowers in semi-urban and rural locations grew at a CAGR of 18% between CY 2017 and CY 2022, compared to 14% growth in metro and urban areas. The overall share of women borrowers in semi-rural and rural locations has risen to 62%, marking an increase of six percentage points during the same period. Among the top 12 states (by total credit active borrowers), West Bengal (22%), Rajasthan (21%) and Bihar (21%) have seen the highest growth in women borrowers between CY 2017 and CY 2022. TransUnion’s latest study on new-to-credit (NTC) borrowers shows that highest proportion of women borrowers have availed agricultural loans and consumer durable loans as their first credit facility in CY 2022. The share of women borrowers among first time credit seekers has increased from 32% in CY 2017 to 34% in CY 2022.
|Table 1. Mapping the emergence of women in India’s retail credit marketSource: TransUnion CIBIL Data|
|Metric on women borrowers||CY 2017||CY 2022||Compounded Annual Growth Rate (CAGR)|
|Access to credit for women|
|Number of women borrowers (million)||31.5||63.5||15%|
|Credit share (to total borrowers)||25%||28%|
|Number of credit applications (inquiries) (million)||22.8||80.6||29%|
|Share of inquiries from semi-urban and rural locations||38%||47%|
|Share of inquiries from 18-30 age group||26%||33%|
|Number of loans disbursed (million)||24.2||72.7||25%|
|Number of consumption loans disbursed (million)||6.0||26.2||34%|
|Loans disbursed to new to credit (NTC) consumers (million)||3.3||5.8||12%|
|Outstanding balances (INR trillion)||6.4||16||20%|
|Share in outstanding balances||17%||19%|
|Credit access (as a % of adult population)||7%||14%|
|Credit profile of women|
|Metric as of CY 2022||Women||Men|
|Borrowers in the Prime3 Score range||57%||51%|
|Geographic insights on women borrowers|
|State with highest number of women borrowers||Tamil Nadu (9.17 million)|
|State with highest growth in women borrowers||West Bengal (22% CAGR in last 5 years)|
|Product specific insights on women borrowers|
|Top three products availed by women borrowers (CY 2022)||Agriculture Loan, Gold Loan, Consumer Durable Loan|
|Age distribution of women borrowers|
|Age group (in years)||CY 2022|
“It is encouraging to note the growth of women borrowers in the semi-urban and rural regions in recent years. With more and more women becoming a part of India’s formal credit market, credit institutions have the potential to empower the women of India by enabling increased access to credit opportunities to fulfill their financial goals,” expressed Chandorkar.
Women increasingly self-monitor their credit scores, empowering them to improve their credit profiles.
In CY 2022, more than 8.2 million women accessed their CIBIL score and report, compared to 5.7 million in CY 2021, demonstrating a growth of 44%. Along with increased awareness and credit consciousness, the participation of women in India’s credit market has also improved with the share of self-monitoring4 women consumers reaching 15% in CY 2022, up from 13% in CY 2021.
The study also found that the highest number of self-monitoring women borrowers are from Maharashtra (16% of total self-monitoring women consumers), followed by Karnataka (10%). It is interesting to note that out of all self-monitoring women borrowers, 60% are from non-metros in CY 2022 (compared to 53% in CY 2021), showcasing a seven percentage point increase in credit awareness in non-metros among women self-monitoring borrowers.
Between 2021 and 2022, the number of new self-monitoring women borrowers grew by 83% compared to the number of self-monitoring male consumers, which grew at a rate of 60%. In terms of the type of loans availed by self-monitoring women borrowers, the trend remains the same as CY 2021, where personal loans and consumer durable loans led preference, with 31% availing a personal loan and 19% availing a consumer durable loan.
“The increase in number of women monitoring their CIBIL Score and report reflects improved financial awareness and credit consciousness. It also demonstrates that women are cognizant that credit discipline matters, and are taking proactive measures to continually improve their credit profile, “says Ms. Sujata Ahlawat, Senior Vice President and Head – DTC Interactive, TransUnion CIBIL.
Insights from CY 2022 show that after checking their CIBIL Score, 45% of self-monitoring women borrowers improved their credit profile (improving their CIBIL Score). Among the self-monitoring women consumers who improved their CIBIL Score, 28% improved their score by 20+ points.
“With many credit institutions offering better terms and conditions and lower rates of interest for borrowers who have a higher CIBIL score, it is beneficial for consumers to monitor and maintain a healthy credit profile. TransUnion CIBIL is committed towards increasing credit awareness among consumers and educating them about the importance of a good credit score for availing financial opportunities on better terms. We believe that by supporting credit literacy and providing resources to build their credit profiles, we can help create a brighter financial future for women, everywhere,” concludes Ahlawat.