'That India is gone': Middle class now lives on credit, not savings, says founder
The shift is cultural as much as financial. “My parents’ generation didn’t like loans… If you couldn’t afford it, you didn’t buy it,” wrote Ashish Singhal, co-founder of CoinSwitch, in a LinkedIn post reacting to the data. “That India is gone.”
- Nov 12, 2025,
- Updated Nov 12, 2025 8:16 AM IST
India’s household borrowing is undergoing a generational shift—fueled not by investments in homes or businesses, but by a rising appetite for lifestyle spending. New RBI data shows personal loans and credit card debt now make up the largest share of household liabilities, overtaking housing loans for the first time and raising red flags about long-term financial stability.
As of March 2024, non-housing retail loans account for 54.9% of all household borrowings, compared to 29% for housing and 16.1% for agriculture and business loans. Debt per capita has jumped to ₹4.8 lakh, up from ₹3.9 lakh just two years ago. More worryingly, these loans now eat up over 25.7% of disposable income, a sharp rise from five years ago.
The shift is cultural as much as financial. “My parents’ generation didn’t like loans… If you couldn’t afford it, you didn’t buy it,” wrote Ashish Singhal, co-founder of CoinSwitch, in a widely shared LinkedIn post reacting to the data. “That India is gone.”
Singhal’s observation reflects the growing normalization of consumption-led borrowing. From personal loans for Bali vacations to EMIs on iPhones, Indians are increasingly financing lifestyles rather than assets. “We’re borrowing to consume, not to build,” he noted, pointing to the proliferation of instant credit via apps, NBFCs, and “buy now, pay later” schemes that have made debt frictionless—and seductive.
The traditional model—where households saved up to 25% of their income—is collapsing under lifestyle inflation and stagnant wage growth. “Everyone you know is traveling, upgrading, living their ‘best life’. So you take a loan. Just this once. Then again. Then it’s normal,” Singhal warned.
This normalization has a cost. Since 2019, personal loans have grown over 3x, far outpacing housing loans (216 index points) and business credit (266). The ease of access is masking long-term consequences.
“Loans compound. Lifestyles don’t reverse easily,” Singhal cautioned. “What happens when this generation hits 40 or 50 and realizes they spent their 20s and 30s paying EMIs instead of building wealth?”.
India’s household borrowing is undergoing a generational shift—fueled not by investments in homes or businesses, but by a rising appetite for lifestyle spending. New RBI data shows personal loans and credit card debt now make up the largest share of household liabilities, overtaking housing loans for the first time and raising red flags about long-term financial stability.
As of March 2024, non-housing retail loans account for 54.9% of all household borrowings, compared to 29% for housing and 16.1% for agriculture and business loans. Debt per capita has jumped to ₹4.8 lakh, up from ₹3.9 lakh just two years ago. More worryingly, these loans now eat up over 25.7% of disposable income, a sharp rise from five years ago.
The shift is cultural as much as financial. “My parents’ generation didn’t like loans… If you couldn’t afford it, you didn’t buy it,” wrote Ashish Singhal, co-founder of CoinSwitch, in a widely shared LinkedIn post reacting to the data. “That India is gone.”
Singhal’s observation reflects the growing normalization of consumption-led borrowing. From personal loans for Bali vacations to EMIs on iPhones, Indians are increasingly financing lifestyles rather than assets. “We’re borrowing to consume, not to build,” he noted, pointing to the proliferation of instant credit via apps, NBFCs, and “buy now, pay later” schemes that have made debt frictionless—and seductive.
The traditional model—where households saved up to 25% of their income—is collapsing under lifestyle inflation and stagnant wage growth. “Everyone you know is traveling, upgrading, living their ‘best life’. So you take a loan. Just this once. Then again. Then it’s normal,” Singhal warned.
This normalization has a cost. Since 2019, personal loans have grown over 3x, far outpacing housing loans (216 index points) and business credit (266). The ease of access is masking long-term consequences.
“Loans compound. Lifestyles don’t reverse easily,” Singhal cautioned. “What happens when this generation hits 40 or 50 and realizes they spent their 20s and 30s paying EMIs instead of building wealth?”.