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The average PV loan amount growing by 49 per cent to ₹8.2 lakh and the average loan tenure increasing by five months to 62 months between the first half (HI) of 2019 and H1 of 2026, according to a TransUnion CIBIL report.

Further, two-wheeler loans (TWLs), traditionally seen as consumers’ first credit product, have now graduated into a mainstream credit product.

First-time borrowers accounted for 39 per cent of TWL originations in H1 2026, down 19 percentage points from 2019, and 43 per cent borrowers had more than two years of credit history at the time of origination, up 16 percentage points from 2019.

Preference for SUVs and feature-rich vehicles has contributed to higher vehicle prices and premiumization, making financing more central to car ownership, said the report  ‘Shifting Gears 2026 – Credit Drives Today’s Mobility’.

“Consumers are taking different routes into car ownership. Gen Z and younger Millennials are more visible among first-time car buyers and consumers moving from two-wheelers to cars, while core and older Millennials are increasingly represented among repeat buyers and consumers financing higher-value vehicles,” it said.

The report noted that rural originations among consumers moving from a two-wheeler to a car grew at a 15 per cent CAGR (compounded annual growth rate) since 2019, almost twice the 8 per cent CAGR for overall auto-loan originations.

Premiumization is extending beyond metros too, with 51 per cent of borrowers taking another higher-value car (HVC) loan in H1 2026 going to consumers in semi-urban and rural geographies, up six percentage points since 2019.

Outstanding balances reached ₹11 lakh crore as of June 2026, 2.6 times the June 2019 level. Active borrower base reached 2.5 crore, 1.7 times the June 2019 level.

Bhavesh Jain, MD & CEO, TransUnion CIBIL, said India’s mobility credit market is becoming more mature, with two-wheeler borrowers building broader credit relationships and passenger vehicle buyers moving towards higher-value ownership.

The growth of younger borrowers, deeper geographies and more varied ownership journeys is widening the market and increasing the role of formal credit in enabling mobility across India, he added.

The report observed that two-wheeler credit has expanded alongside shift in the borrower profile. Outstanding balances reached ₹1.76 lakh crore as of June 2026, 3.2 times the June 2019 level, while the active borrower base reached 3.3 crore from 1.7 crore in June 2019.

Portfolio quality also improved over the period, with 90+ days past due balance-level delinquency declining to 1.4 per cent, its lowest level since June 2019 observed at 2.7 per cent.

In H1 2026, 64 per cent of TWL borrowers were from semi-urban and rural geographies (SuRu), and 43 per cent were aged 30 years or younger.

Borrowers’ credit relationships are also becoming broader, with 32 per cent of two-wheeler loan consumers holding consumption-led credit such as personal loans, consumer durable loans and credit cards in their wallets, this has increased by 10 percentage points compared to 22 per cent in H1 2019.

Credit relationships often extend well beyond the initial vehicle purchase. Among consumers who originated a two-wheeler loan in H2 2022, 68 per cent went on to originate another credit product within the next three years.

This increased to 84 per cent among first-time two-wheeler borrowers who already had at least two years of credit history. Their subsequent credit relationships can extend within 12 to 18 months into products ranging from personal loans and credit cards to auto and home loans.

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