Stories
Rural India Drives Vehicle Loan Growth Amid Better Credit Quality
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CNBC TV18•13-10-2026, 12:33
Rural India Drives Vehicle Loan Growth Amid Better Credit Quality
- •Rural and semi-urban India are driving growth in the vehicle finance market, accounting for 61 percent of loan originations in the first half of 2026.
- •Improving borrower credit profiles, better repayment behavior, and a more credit-aware consumer base are giving lenders greater confidence.
- •Festive demand for two-wheelers and passenger vehicles is expected to remain robust despite higher interest rates and rising vehicle prices.
- •Non-banking financial companies play a major role in vehicle finance, accounting for 73 percent of live two-wheeler loans and 37 percent of passenger vehicle loans.
Key Questions Answered
Rural and semi-urban centres accounted for 61% of vehicle loan originations during the first half of 2026.
Outstanding two-wheeler loans have crossed ₹1.6 lakh crore, while outstanding car loans have increased to nearly ₹11 lakh crore.
Non-banking financial companies (NBFCs) account for 73% of live two-wheeler loans and 37% of passenger vehicle loans.
