Despite RBI rate cuts, youngsters refrain from borrowing: Report

The retail credit market continued to see a softening in the last quarter of 2024–25, as new loan originations (partly a measure of credit demand and supply) grew at a slower rate of 5 per cent in March 2025 against 12 per cent a year ago, according to a report.

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The slowdown was despite the RBI slashing its benchmark lending rate by 25 basis points to 6.25 per cent in February.

This and other factors pushed the Credit Market Indicator (CMI) to a two-year low of 97, according to TransUnion CIBIL’s June 2025 Credit Market Report.

“The slowing of credit demand from younger consumers was evident from the fall in the share of enquiries from those aged 35 years or younger to 56 per cent for the quarter ending March 2025, down from 58 per cent in the quarter ending March 2024.

The report said across all other loan products growth in volume was lower than the growth in value