Understanding Users’ Experience With Digital Lending Applications in India

This slide deck shares the results of a survey conducted by MSC and FACE to analyze user knowledge and behavior regarding digital lending applications (DLAs) and digital loans. The findings reveal that while 70% of users felt confident verifying loan apps, many lacked awareness of how to identify illegal lending apps. More than half of the users were uninformed about proper verification methods, making them susceptible to fraud. Most users focused on partnerships with NBFCs/Banks, reviews, and ratings, often overlooking downloads and data-sharing metrics. Even highly confident customers demonstrated limited understanding of their digital loans, such as the Key Fact Statement and Grievance Redressal mechanism.

Social media advertising strongly influences digital loan purchases, with friends and family playing a significant role in decision-making. Female users showed better awareness of loan products compared to male users. Digital lending applications positively impacted 76% of users, whereas 11% reported negative experiences. Finally, individuals who did not use loan apps, mostly in rural areas, mentioned reasons such as no loan requirement, access to alternative credit sources, or unfamiliarity with loan apps.