UPI and Small Loans Are Quietly Replacing Credit Cards in India. Here's Why.

A recent TransUnion CIBIL report found UPI and small personal loans are steadily overtaking credit cards as Indians preferred way to pay and borrow. Worth understanding why. Credit cards carry a cost most people underestimate. Revolving credit card interest in India typically runs 36-48% annually if you don't clear the full balance. Small personal loans, for prime borrowers, often start around 10-12%. If you can't repay within about 45 days, a personal loan works out nearly four times cheaper. That's why the shift makes sense once you run the math. A credit card offers convenience, but slip into revolving a balance and the cost compounds fast. A personal loan forces structure instead, a fixed EMI, a fixed end date, no "minimum due" trap stretching for years. UPI's rise is related but different. It's not credit at all, it's a payment rail, reducing how often people even need revolving credit for everyday spending. A company like $BAJAJFINSV , with heavy exposure to both consumer lending and payments, sits right at the center of this shift. The takeaway. This isn't just a fintech trend to note. It reflects people choosing cheaper, structured borrowing over convenient but expensive revolving credit, worth applying to your own situation if you're carrying a card balance month to month.