GenZ prefers personal loans; millennials go for credit cards, shows data | Personal Finance

Personal loans make up 40 per cent of borrowing among Gen Z customers aged 18 to 25 out of the total loans disbursed to the cohort, with common use cases being travel or technology purchases, according to a report.

In contrast, the share of personal loans is about 21 per cent for the millennial cohort aged between 26 and 38. For millennials, credit card spending is the most popular, with the payment instrument accounting for 30 per cent of the total loan disbursals for the cohort, according to a report by Redseer Strategy Consultants.

Out of the total loans disbursed, digital lending has increased from 1.8 per cent in financial year 2022 (FY22) to 2.5 per cent in FY24. The report added that digital lending is expected to corner about 5 per cent of the total retail loans disbursed by FY28.