DIY lending for Gen Z? Inside India's new era of seamless, personalised credit

Mint

10-07-2025

In the very near future, the most influential demographic in India's active financial ecosystem will be Generation Z. As of 2025, India's Gen Z population (born ~1997–2012) is estimated at around 380 million, making up nearly 26% of the country. Of these, approximately 317 million are aged 18 and above, forming a massive segment of digitally native, financially active individuals whose expectations from financial services are shaped by seamless, secure, and tech-driven experiences.
These are cohorts that have grown up surrounded by automation, digitisation, and an unwavering focus on customer experience. For them, digital interaction is second nature from education to entertainment, from ordering food to shopping for toys, every part of their lives has been shaped by seamless digital access. Gadgets, apps, and digital tools are as common to them as Barbie dolls and Hot-wheels once were for previous generations.
Naturally, their expectations from financial products and services are deeply rooted in the digital realm. They demand speed, convenience, and minimal human intervention whether it's opening a bank account, investing in mutual funds, or applying for credit.
This generation has also witnessed a world where credit is accessible for everything from a few thousand rupees for daily needs to several lakhs or crores for significant investments. Regardless of the amount, what remains consistent is their demand for a smooth, intuitive, and trustworthy experience. And it doesn't stop at convenience they also expect robust digital security. Multifactor authentication, strong passwords, PINs, biometrics, and even complex passcodes are now standard expectations. These young digital natives want to feel secure while navigating financial services with ease.
This places a significant responsibility on the financial ecosystem to innovate and deliver. While we have seen progress in savings products that blend utility with experience like theme-based savings accounts and lifestyle-linked rewards credit products still have room to evolve. Credit cards, for instance, have diversified into multiple variants catering to specific needs like online shopping, travel, or luxury experiences. But lending, especially mid-to-large ticket lending, still faces friction.
Small-ticket digital loans have become almost real-time, but larger loans over ₹ 5 lakh, for example, still come with manual intervention processes and fragmented user journeys. Compounding the issue is the fact that loans are often tied to a specific end-use: buying a phone, a laptop, a vehicle, a house, or funding a medical expense. Each of these purposes is evaluated with a separate risk model, despite the fact that the borrower is the same individual.
This raises an important question: can we shift from end-use-based risk models to borrower-centric ones? What if we assessed creditworthiness based solely on the individual's profile, their financial behaviour, income patterns, repayment history regardless of whether the loan is for a used car, a vacation, or home renovation?
The good news is that India's digital infrastructure is increasingly enabling this shift. Regulatory initiatives and frameworks like the JAM trinity (Jan Dhan, Aadhaar, Mobile), Account Aggregators (AA), availability of alternative data and strengthened credit bureaus are creating an integrated ecosystem of verified, permission-based personal data.
Today, lenders can access: Identity and Address verification via Aadhaar
Income tax returns through PAN
GST data for trade and business profiles
Bank transaction history
Utility bills payment history
Repayment behaviour through credit bureaus
Together, these data streams can form a comprehensive 360-degree view of the borrower, enabling the creation of truly robust and intelligent credit models.
Such models could eventually lead to a unified credit journey - a single, streamlined digital experience where a borrower simply states how much credit they need and for how long. With a single consent, they could allow access to verified financial data, receive tailored loan offers, compare terms, and choose the best credit facility all within minutes.
To support this vision, the RBI's recent launch of the Unified Lending Platform (ULP) marks a significant milestone. This initiative aims to bring together all stakeholders borrowers, lenders, data providers, and regulators into one seamless, digital lending ecosystem. By enabling better decision-making and more personalised offerings, ULP has the potential to redefine credit accessibility and elevate the customer experience in lending across India.
As India moves toward this unified and borrower-centric future, the opportunity is clear: reimagine lending not as a fragmented, purpose-led transaction, but as a continuous, personalised experience rooted in trust, data, and digital empowerment. For lenders, this means moving beyond legacy systems and embracing intelligent infrastructure that speaks to the expectations of a new generation.
For borrowers, especially the Gen Zs and Alphas driving tomorrow's economy, it means access to credit that is not just faster, but fairer, smarter, and truly aligned with their digital-first lives. The road ahead is not just about digitising loans; it's about humanising credit through technology, policy, and purpose - or do we call it DIY lending?
Disclaimer: The information provided in this article is for informational purposes only and does not constitute financial, legal, or professional advice. While every effort has been made to ensure accuracy, readers should verify details independently and consult relevant professionals before making financial decisions. The views expressed are based on current industry trends and regulatory frameworks, which may change over time. Neither the author nor the publisher is responsible for any decisions based on this content.
Ramkumar Gunasekaran, Director Sales, CRIF High Mark