The Indian securitisation market reached a historic milestone as transaction values climbed to an all-time high of ₹2.55 lakh crore in fiscal 2026. This record-breaking performance was largely propelled by a 30 per cent year-on-year surge in originations by non-banking financial companies (NBFCs), which effectively countered a sharp decline in activity from the banking sector.
According to Crisil Ratings, the market saw more than ₹65,000 crore in transactions during the January-March quarter alone, representing a 20 per cent growth compared to the same period in the previous year.
NBFCs step in
While the overall annual growth rate stood at 9 per cent, the internal dynamics of the market shifted significantly over the past twelve months. NBFCs stepped up their activity to fill the gap left by banks, whose share of total originations plummeted to just 3 per cent in fiscal 2026, down from 26 per cent in the preceding year.
Despite this shift, the market remains concentrated among top players, though the total number of originators expanded to over 190. The share of the top 20 originators decreased to 65 per cent from 71 per cent, suggesting a gradual broadening of market participation.
"Increased NBFC activity reinforces the attractiveness of securitisation as a strong alternative fund-raising tool, especially for mid-sized players. Robust performance of cherry-picked pools and structural credit enhancements in pass-through certificates (PTCs) continues to support investor confidence in this market. Among NBFCs, while originations by vehicle financiers remained strong, goldloan-backed securitisation emerged as the second-largest asset class, surpassing mortgages, last fiscal," said Aparna Kirubakaran, Director, Crisil Ratings.
Asset preferences change
Asset class preferences saw a notable realignment during the fiscal year. Vehicle loans maintained the largest market share at 40 per cent, even as their dominance slipped from 47 per cent in fiscal 2025. Gold loan-backed securitisation witnessed a robust surge, accounting for 15 per cent of total transactions and overtaking mortgages, which fell to a 14 per cent share.
This decline in mortgages was primarily attributed to subdued participation by a major private bank. Meanwhile, business and personal loans collectively accounted for 17 per cent of the market, while microfinance originations saw a slight increase to 12 per cent.
The method of transaction also shifted, with Pass-Through Certificates (PTCs) gaining significant ground over Direct Assignments (DAs). PTCs now represent approximately 60 per cent of the total market volume as investors increasingly prefer the structural protections they offer, particularly in unsecured lending segments like microfinance.
"PTC originations have achieved an all-time high volume, accounting for ~60 per cent of the total market. PTCs are clearly gaining favour across asset classes, especially in the unsecured space. Investors in unsecured loan transactions, like microfinance, are preferring the PTC route, due to the support provided by external enhancement, following the asset quality challenges that emerged in the previous fiscal. PTCs accounted for 69 per cent of microfinance securitisation transactions last fiscal, compared with 30 per cent in fiscal 2025. DAs, on the other hand, continue to be the preferred route for mortgages and gold loans," stated Payal Anand, Associate Director, Crisil Ratings.
On the investor front, while public and private sector banks remain the primary backers of these deals, there is growing interest from mutual funds and foreign banks. Insurance companies and pension funds have also begun investing in select transactions.
This diversified investor base is expected to support continued momentum into fiscal 2027, with NBFCs likely remaining the primary drivers of issuance as they utilise securitisation to manage resources and diversify their funding channels.
Published on April 9, 2026