Personal loans jump 32% in Q1 FY27: How home, auto and consumer loans compare — and what borrowers should watch

If you are considering taking a for a large purchase, home renovation, wedding, or another expense, the latest credit-market numbers show that unsecured borrowing is growing considerably faster than home loans.

An Experian Industry Insights report reveals that personal-loan sourcing — the value of new loans originated or sanctioned during the quarter — rose 32% year-on-year to ₹3 lakh crore during April-June 2026 (Q1 FY27).

Personal-loan assets under management (AUM), which represent the outstanding loan portfolio, stood at ₹16.2 lakh crore as of June 2026, up 14% YoY.

That compares with AUM of ₹43.6 lakh crore, which grew 13% YoY. So while personal loans are growing faster, the home-loan portfolio remains substantially larger.

Why are personal loans growing faster than home loans?

According to Experian findings, the broader unsecured-credit segment grew 26% YoY in Q1 FY27, making it a significant driver of credit growth. Personal loans and consumer loans contributed significantly, while credit cards showed some resurgence.

Personal loans alone saw 32% growth in new sourcing, compared with the more measured expansion in home loans. For consumers, this suggests that smaller and relatively quicker-to-access forms of borrowing are becoming an increasingly important part of the credit market.

How does personal-loan borrowing compare with home loans?

The difference becomes clearer when looking at portfolio size and ticket values.

The home-loan average ticket size increased from ₹32.2 lakh in Q1 FY26 to ₹34.8 lakh in Q1 FY27. also increased their presence in the above- ₹80 lakh premium housing segment.

Does faster unsecured growth mean borrowers are under more stress?

According to the report, the overall numbers do not indicate a deterioration in asset quality. Total industry net 30+ delinquency — the share of loans with repayments overdue by more than 30 days — was 3% in June 2026, improving from 4.1% in June 2025. Personal-loan net 30+ delinquency was 2.3%.

Manish Jain, Country Managing Director, Experian India, said, “India’s credit market continues to demonstrate resilience, with sustained portfolio growth and good asset quality providing a strong foundation for the next phase of expansion. The momentum in unsecured lending reflects the evolving credit needs of consumers, while the continued strength of secured portfolios points to a balanced market.”

For consumers, however, faster availability of unsecured credit should not automatically be treated as a reason to borrow more. A personal loan does not create an asset like a home loan does, so the EMI needs to be assessed against existing debt and monthly cash flows.

What does the overall credit market tell consumers?

According to Experian, total loan sourcing reached ₹20 lakh crore in Q1 FY27, up 18% YoY, while industry AUM reached ₹142 lakh crore as of June 2026, also up 18%. Growth moderated from Q4 FY26, but both secured and unsecured lending continued to expand.

The key takeaway for consumers is therefore not simply that personal loans are growing faster. It is that India’s credit mix is changing: personal, consumer-durable and two-wheeler borrowing is expanding rapidly, while home and auto loans remain important larger-ticket categories.

For an individual borrower, the practical lesson is to look beyond loan approval. Compare the new EMI with your existing obligations, understand the total repayment cost, and avoid using rapidly available unsecured credit simply because it is accessible.

Disclaimer: This is for informational purposes only. Always consult a financial adviser before making investment or financial decisions.