Core Insights - Non-banking finance companies (NBFCs) maintained their dominance in small-ticket loans, particularly in the segment under Rs 1 lakh, but their share of loan origination decreased to 37% from 41% [1] - Private banks also saw a decline in their share of loan origination, falling to 25% from 28% [1] - The overall personal loans outstanding increased by 3% quarter-on-quarter, with originations rising by 32% to Rs 2.92 lakh crore, driven by a 13% increase in volumes and a 17.3% jump in average ticket size to Rs 69,000 [9] Loan Segmentation - Unsecured personal loans yield higher returns compared to other retail loan segments, making them easier to grow in a consumption-driven economy like India [2][9] - Public sector banks increased their share in unsecured personal loan origination to 36% in the September quarter, up from 27% in the previous quarter, driven by a focus on larger loan amounts [9] - The asset quality in the personal loan segment remains stable, with the portfolio at risk for overdue up to 90 days decreasing to 1.6% from 1.8% a year ago, while the share of risky portfolios with over 180 days overdue rose to 5.6% from 4% [6][10] Market Dynamics - Banks have tightened underwriting standards following regulatory caution, while a digital drive is facilitating seamless growth in personal loans [7][10] - The State Bank of India (SBI) reported a 3.2% year-on-year expansion in its loan asset to Rs 3.52 lakh crore, which is nearly five times its gold loan portfolio [8] - The overall lending universe for personal loans with minimal documentation grew by 12% year-on-year to Rs 15.4 lakh crore, making it the second-largest consumption loan category after home loans [9]