160 Million Indian Consumers are Credit Underserved

According to a recent study titled “Empowering Credit Inclusion: A Deeper Perspective on Credit Underserved and Unserved Consumers” by Global TransUnion, it is concluded that more than 160 million consumers are considered credit underserved in India. The study also found that about 5% of consumers who were credit undeserved transformed into credit-active consumers within a period of two years. Let us know more in detail about the study!

Who is Considered as Credit Underserved and Unserved Consumers?

  • Underserved – Consumers who have some, but limited credit presence. Specifically, if they are:
    • Active in the credit market for at least the past 2 years.
    • 0-2 currently opened traditional credit accounts.
    • Only 1 type of credit product was held.
  • Unserved – Consumers who have never had an open traditional credit product, which means they do not have any credit history as well. Unserved consumers can also be referred to as credit invisible, which means there is no credit data available which can help the lenders analyse their credit history.

To size the unserved population, TransUnion CIBIL subtracted the underserved, new to credit and served consumers, and the remaining number is unserved.

Also to be noted, the TransUnion global study does not include information about the newly acquired consumers who have opened their first product in the last two years. These newly acquired consumers become fully credit active after opening their first product. Hence, this study tends to understand those consumers who have remained underserved over a long period.

“India’s retail credit market is undergoing rapid evolution supported by the speed and scale of digital transformation. This transformation coupled with India’s demographic dividend has triggered unprecedented opportunities for driving growth and financial inclusion in the market,” said Rajesh Kumar, MD & CEO of TransUnion CIBIL.

According to the study, two types of consumers were studied over two years. The first was during the pre-pandemic period beginning from Mar 2018 to Mar 2020, and the second began from Jun 2019 to Jun 2021. The study was conducted to determine if there were any pandemic related shifts that occurred due to trends in consumer credit migration.

In addition to India, TransUnion global has also conducted similar studies in multiple markets, including the US, Canada, Colombia, South Africa, and Hong Kong to understand the global market size, needs and behaviours of the unserved and underserved consumers segment.

Increase in Credit Served Consumers in India Over Four Years

According to TransUnion CIBIL research, it is proven that there has been a significant hike in credit served consumers in India from 91 million in 2017 to 179 million in 2021. These statistics thereby provide an estimate of 12% to 22% of the adult credit population that is served.

Many lenders are hesitant to extend credit to consumers without any credit score or history. For such traditionally unscorable consumers, it can be confusing to get that first credit product when they have no credit history.

“Although India has made great strides in increasing levels of credit inclusion across the country in recent years, the current reality highlights the importance of incorporating enriched credit data into the lending ecosystem, so that fewer consumers find themselves as credit unserved. Once these consumers can be evaluated by financial institutions, lenders can better determine where there might be new opportunities for growth and how they can expand credit inclusion further,” said Kumar.

The credit unserved has fallen from 67% in December 2017 to 50% in December 2021. But is still considered a major element in the overall matrix. The lack of credit score or credit history for the unserved consumers can become a barrier while trying for credit opportunities. As many lenders shall be hesitant to provide credit to consumers with no score or history. Hence, they face a challenge to get that first credit product as they lack credit history.

Percentage of Undeserved Consumers In India on Yearly basis

In recognition of this problem, last year TransUnion CIBIL also launched its CreditVision New-to-Credit (NTC) score to help enhance greater credit inclusion thus enabling banks and other lending institutions to provide credit access to those consumers seeking loans for the first time.

Once underserved consumers hike to the credit served category, they are likely to apply for more credit.

Every year a portion of underserved consumers become more fully credit active by opening additional credit products, while the others remain in the underserved segment. In the wider TransUnion CIBIL global study, it was found that in markets like South Africa and Colombia, the credit products mostly held by underserved consumers were clothing loans (59%) and microcredit (37%), respectively. On the other hand, if you consider India; agriculture, micro-finance, two-wheelers, consumption loans such as personal loans, credit cards, etc. are the most preferred products by credit underserved consumers.

Key Findings of the Survey

  • 27% of the underserved consumers which equals 58% of the unserved consumer segment have concluded that they do not have sufficient access to credit.
  • 38% of the underserved consumers and 65% of the unserved consumers have concluded that they were not happy with their current amount of credit.
  • 39% of the underserved consumers have indicated that they do not require more credit in comparison to 66% of the unserved consumers. Both the consumer segments have specified that their top reason for not opting for credit is because of the higher interest rates charged by financial institutions.
  • 84% of the underserved consumers and 35% of the unserved consumers have indicated that they plan to apply for new credit in the coming six months. The top two credit products that these consumers are planning to avail are personal loans and credit cards.

“Promoting financial inclusion starts with gathering a better understanding of the different nuances between the unserved, underserved and served populations and what makes them tick. For example, what drives unserved consumers to apply for credit, and why underserved consumers may need a different credit product, may vary greatly. As lenders are better able to meet the unique needs of these consumer segments and educate these unserved and underserved segments on ways they can build and improve their credit profiles, a larger percentage of consumers will become actively engaged in the credit system,” concluded Kumar.

Note: The study findings were a part of TransUnion CIBIL’s ongoing commitment to help improve financial awareness and inclusion across India.


Even after the advent of technology, access to credit is still a major problem for the majority of the Indias. Vivifi India Finance Private Limited understands the needs of the lower middle class and middle-class Indians who don’t have access to any of the credit products and is offering an emergency credit line through its loan offering products FlexSalary and FlexPay to cater for their needs, irrespective of their credit profile.

Vivifi India has an aim to provide instant access to credit for millions of underserved Indians and the newer generation who are geared towards instant gratification.


1. Who are financially underserved consumers?

Consumers who struggle to get access to mainstream financial products due to volatile income or credit challenges are underbanked and are financially underserved consumers.

2. How many consumers in India have insufficient access to credit?

At the end of 2021, more than 160 million consumers are credit underserved in India, according to a new global TransUnion study “Empowering Credit Inclusion: A Deeper Perspective on Credit Underserved and Unserved Consumers”.

3. How many consumers are credit served in 2021? 

According to TransUnion CIBIL, there has been a significant increase in credit served consumers in India. From 91 million in 2017 to 179 million in 2021, the raise has been estimated from 12% to 22% as per the adult population.

4. What is financial inclusion?

Financial inclusion is referred to as the method of offering financial and banking solutions and services to every individual in society without any discrimination.

5. What is basic financial literacy? 

Financial literacy is your ability to understand and effectively use various financial skills – such as budgeting, financial management, and investing.