For millions of young Indians, the first formal loan is a turning point. It creates a credit history, opens the door to larger and cheaper borrowing later in life and reduces reliance on informal moneylenders. Digital lending platform mPokket says it has now provided that first step to more than 6.5 million people.
The Bengaluru-based company announced on September 25 that it has onboarded over 6.5 million new-to-credit (NTC) customers, meaning borrowers with no prior formal credit history. The number of such customers it acquires has grown by about 20 per cent a year over the past three years.
The profile of those borrowers is striking. According to mPokket, 79 per cent were under 25 when they first accessed formal credit through the platform. And 83 per cent of its lifetime NTC portfolio comes from rural and semi-urban India, well beyond the metropolitan markets where most fintech companies compete.
The numbers behind the milestone
mPokket expects its lifetime disbursals to exceed $5.5 billion in the financial year 2026. Looking ahead, the company has set targets of more than ₹25,000 crore in annual disbursals and a loan book above ₹20,000 crore within three years.
It has also raised the ticket size available to small business owners to ₹2 lakh, as it extends lending to self-employed professionals and entrepreneurs in addition to its traditional base of young first-time borrowers.
"Crossing 6.5 million first-time borrowers is an important milestone for us because it validates that technology-led underwriting can responsibly expand access to formal credit at scale," said Gaurav Jalan, founder and chief executive of mPokket.
Why new-to-credit matters
India has made remarkable progress in financial inclusion over the past decade. The Jan Dhan programme brought hundreds of millions of people into the banking system, and the Unified Payments Interface (UPI) has made digital payments routine even in small towns.
Access to credit has lagged behind. Banks and traditional lenders rely heavily on credit bureau scores, which are built from a borrower's repayment history. That creates a classic catch-22: people cannot get a loan without a credit history, and they cannot build a credit history without a loan. Young people, informal workers and residents of smaller towns are most affected.
Companies such as mPokket have tried to solve this problem with what is known as alternative-data underwriting. Instead of relying only on bureau scores, they analyse other signals, such as digital transaction patterns and other data points that borrowers consent to share, to estimate the likelihood of repayment. Small initial loans allow a borrower to demonstrate reliability, and those who repay can gradually access larger amounts.
Once a borrower has repaid a formal loan, that record is reported to credit bureaus. In effect, the first loan becomes the foundation of a credit profile that banks and other lenders can later use.
The risks the industry must manage
Lending to first-time borrowers carries higher risk, and India's digital lending sector has faced scrutiny in recent years. The Reserve Bank of India has tightened rules on digital lending, including requirements on disclosure, data privacy, recovery practices and the relationship between lending apps and regulated entities.
Those rules were introduced after complaints about aggressive recovery tactics and opaque fees at some lending apps. For established players, stricter regulation has become a competitive advantage, because it raises the bar for new entrants and reassures customers and investors.
mPokket's emphasis on the word "responsibly" in Jalan's statement reflects that environment. Scaling quickly in unsecured consumer credit can generate impressive growth numbers, but the true test is asset quality over a full economic cycle. Investors, rating agencies and regulators will be watching how the company's loan book performs as it grows toward the ₹20,000 crore target.
Rural and semi-urban India as a growth engine
The concentration of mPokket's portfolio outside big cities is notable. Much of India's future consumption growth is expected to come from smaller towns, where incomes are rising and smartphone penetration has expanded rapidly.
These markets are often underserved by banks, which have fewer branches and less data on potential borrowers. A digital lender that can assess risk accurately in these regions has a large, relatively uncontested market.
The focus on young borrowers also has long-term value. A customer who takes a first loan at 21 may need education financing, a two-wheeler loan, a personal loan and eventually a home loan over the following decades. Platforms that earn that customer's trust early can build a lifetime relationship, either directly or through partnerships with banks.
The shift toward small business lending
mPokket's move to raise loan sizes for small business owners to ₹2 lakh reflects a broader trend in Indian fintech. Micro, small and medium enterprises (MSMEs) contribute significantly to employment but face a large credit gap, particularly the smallest businesses that operate informally.
By lending to self-employed professionals and small entrepreneurs, mPokket can diversify its portfolio and serve customers whose borrowing needs grow over time. It also aligns the company with government priorities around entrepreneurship and formalisation of the economy.
What to watch
The company's three-year targets imply significant growth. Reaching ₹25,000 crore in annual disbursals and a ₹20,000 crore loan book will require continued access to funding, whether through equity, debt markets or co-lending partnerships with banks and non-banking financial companies.
It will also require sustained investment in technology. mPokket has said its growth will be supported by alternative-data underwriting and further technology investments, which will be crucial to keeping credit costs in check as it expands.
The bigger picture
India's journey from payments inclusion to credit inclusion is still at an early stage. UPI has shown that digital infrastructure can transform access to financial services at remarkable speed. The next challenge is to extend affordable, responsible credit to the hundreds of millions of Indians who still lack a formal credit history.
mPokket's milestone of 6.5 million first-time borrowers shows the scale of that opportunity, and the role that technology-led lenders can play in addressing it. Whether that growth translates into lasting financial inclusion will depend on the quality of lending as much as the quantity, and on whether first-time borrowers go on to build stronger financial lives as a result.
