90% of borrowers hold CIBIL scores above 725; average draw of Rs7,000 points to small-ticket, everyday credit use
FinTech BizNews Service
Mumbai, 23 June 2026: Suryoday Small Finance Bank (SSFB), a leading new-age digital bank in India, today shared early portfolio data from its Credit Line on UPI (CLOU) business that challenges a common assumption about embedded digital credit. Nearly 90% of borrowers hold CIBIL scores above 725 — firmly in prime and near-prime territory, while the average utilized ticket size is just around Rs7,000 against limits of up to Rs60,000, signalling the emergence of small-ticket “sachet credit” embedded in everyday spending.
Launched in August 2025 in partnership with Paytm, CLOU has scaled rapidly within eight months, reaching nearly 11 lakh pre-qualified customers, over 5.3 lakh sanctioned customers and around 2.4 lakh active utilizations. Sanctioned credit limits have crossed ₹362 crore and utilized limits have exceeded Rs102 crore. The portfolio has recorded a Compounded Monthly Growth Rate (CMGR) of approximately 63% over the last five months, highlighting the strong consumer acceptance and scalability of the model.
A large and underserved opportunity
India's digital payments ecosystem presents a significant opportunity for embedded credit. According to NPCI data, UPI processed over 24,162 crore transactions during FY26 and now accounts for nearly 63% of all retail digital payments by volume. In May 2026 alone, UPI recorded 23.2 billion transactions worth Rs29.9 lakh crore.
Despite this scale, formal credit penetration remains relatively low, with credit cards reaching only 5-6% of India's population compared to more than 300 million active UPI users. This gap presents a substantial opportunity for digital credit products that can seamlessly integrate into everyday payment journeys.
SSFB was among the first Small Finance Banks to partner with Paytm for UPI-linked credit lines, positioning itself early in a category that is expected to become a significant driver of retail credit growth in the coming years.
Borrower Quality Signals Strong Portfolio Strength
One of the most encouraging trends emerging from the portfolio is the quality of customers adopting the product. Nearly 90% of customers have CIBIL scores above 725, indicating that CLOU is increasingly attracting prime and near-prime borrowers, this firmly contradicts the assumption that digital embedded credit primarily serves sub-prime or credit-starved segments.
The bank is also witnessing the rise of "sachet credit" behaviour. While customers are eligible for limits of up to ₹60,000, the average utilized ticket size is approximately ₹7,000. This suggests that customers are using the facility primarily for everyday consumption needs such as groceries, dining, fuel, telecom recharges and pharmacy purchases. Approximately 50% of sanctioned accounts are actively utilized, a healthy activation rate for a product live for under eight months. The trend reflects growing consumer preference for small-ticket, need-based credit embedded directly into daily payment habits.
Embedded in Daily Life: Where Customers Are Spending
The highest transaction volumes are in groceries and supermarkets, followed by dining, fuel, telecom recharges, and pharmacies. Approximately 50% of sanctioned accounts are actively utilized—a healthy activation rate for a product that has been live for under eight months.
Commenting on the trend, Baskar Babu Ramachandran, MD & CEO of Suryoday Small Finance Bank, said, "UPI transformed the way India makes payments. We believe Credit on UPI has the potential to do something similar for access to formal credit by making it available seamlessly within everyday transactions. What is particularly encouraging is the quality of customers adopting the product. The strong credit profiles, responsible borrowing behaviour and healthy utilization trends validate our belief that embedded credit can become a meaningful part of India's retail lending ecosystem. As digital payments continue to deepen across the country, we see significant opportunities to expand access to formal credit while maintaining prudent underwriting and portfolio quality."
Geographic Momentum: North and West India Lead
Traction is strongest across North and West India, with Jaipur currently contributing approximately 14% of the portfolio—the single largest city share. Delhi NCR is another key cluster, with North West Delhi and East Delhi together contributing over 20% of the portfolio.
In Western India, cities such as Mumbai, Ahmedabad, Surat, Pune, and Indore are showing meaningful momentum, while Bengaluru leads adoption in the South. The geographic spread reflects adoption concentrated in markets characterised by high UPI penetration, dense merchant ecosystems, and strong consumer familiarity with digital payments.
With more than 97% of customers being new-to-bank, the product is also serving as a powerful customer acquisition engine, helping them to expand its retail franchise while maintaining disciplined underwriting and healthy portfolio quality. Industry estimates believe CLOU could emerge as one of the largest embedded finance categories in the country. Suryoday SFB's early traction, strong borrower quality and rapid portfolio growth position the bank favourably to participate in this structural transformation of India's retail lending landscape.
Credit on UPI: Key Metrics at a Glance
