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As of December 2024, 27 million women were monitoring their credit, marking a 42% increase from the previous year, signaling growing financial awareness
With rising credit awareness and improved scores, financial institutions have the opportunity to offer gender-smart financial products tailored to women’s unique needs, NITI Aayog observed. Representational image
The socio-economic landscape of India has been undergoing a transformative shift, with women increasingly at the forefront of driving change across diverse sectors. In a report—From Borrowers to Builders: Women’s Role in India’s Financial Growth Story—released by NITI Aayog on Monday, the premier policy-making body of India stated that women seeking credit grew threefold between 2019 and 2024, while at least 60% of borrowers are from semi-urban and rural areas.
Women’s credit product preferences include loans against property (36%), agricultural loans (26%), business loans (25%), and commercial vehicle loans (19%). Uttar Pradesh, Maharashtra, and Tamil Nadu are the top three states which witnessed overall growth in live loans.
As of December 2024, 27 million women were monitoring their credit, marking a 42% increase from the previous year, signaling growing financial awareness.
The report was launched by CEO NITI Aayog, BVR. Subrahmanyam, and was prepared by TransUnion CIBIL, the Women Entrepreneurship Platform (WEP) of NITI Aayog, in collaboration with MicroSave Consulting (MSC).
Broader economic spectrum
According to the report, women, from working in rural Self Help Groups (SHGs) to high-tech startups in bustling urban centres, are making significant strides as creators, innovators, and leaders. This means the female workforce, present in a broad spectrum of socio-economic levels, have empowered themselves in various ways despite historical barriers and systemic challenges. Their financial participation is becoming an integral part of India’s economic story.
The report highlights that women’s share of the total self-monitoring base increased to 19.43% in December 2024, up from 17.89% in 2023. “More women from non-metro regions are actively self-monitoring their credit compared to those in metro areas, with growth of 48% in non-metro regions and 30% in metro areas,” stated the report.
It further added that Maharashtra, Tamil Nadu, Karnataka, Uttar Pradesh, and Telangana accounted for 49% of all self-monitoring women, with the southern region leading at 10.2 million in 2024.
Meanwhile, northern and central states, including Rajasthan, Uttar Pradesh, and Madhya Pradesh, saw the highest compounded annual growth rates (CAGR) in active women borrowers over the past five years.
Growth story
The report further states that women’s share in business loan origination has increased by 14% and their share in gold loans has grown by 6%, with women accounting for 35% of business borrowers by December 2024. The process of growth has been continuing since 2019.
However, there are some challenges too. The difficulties include credit aversion among a section of women, poor banking experiences, barriers to credit readiness, and issues with collateral and guarantors.
With rising credit awareness and improved scores, financial institutions have the opportunity to offer gender-smart financial products tailored to women’s unique needs, NITI Aayog observed. Significantly, women are becoming entrepreneurs, while a section is also embracing financial independence through credit access.
Rising demand
Over the past five years, since 2019, the number of women seeking credit in India has experienced a remarkable surge, growing nearly threefold between 2019 and 2024. This sharp rise reflects a larger trend of financial inclusion and economic independence among women.
The study stated that the women-driven demand for credit is not limited to traditional sectors like agriculture and retail. It is spanning various industries, including technology, manufacturing, and services. Women are increasingly seen as key players in driving innovation and entrepreneurship, with many leveraging credit to scale up their businesses or manage personal finances.
The surge in borrowing is particularly prominently visible in semi-urban and rural areas, where approximately 60% of women borrowers come from. This trend shows the growing awareness and access to financial products in regions previously underserved by traditional banking systems. Women in such areas are increasingly taking the initiative to invest in their businesses, education, and household needs, making them active contributors to the local and national economies. However, despite the clear progress, there is still a substantial gap in financial engagement among younger women.
Credit patterns
The analysis has shown a striking trend using the available data. It paints a picture of the relatively low participation of young women under 30 in retail credit uptake, at about 27%. Men make up 40% of retail credit consumers in the same age group.
The gap also suggests a need for targeted interventions to encourage younger women to engage with credit facilities, assisting them in building financial security and taking risks in entrepreneurship. Access to tailored financial products and services, as well as financial literacy programs, will be crucial in bridging this gap.
