India's Securitisation Market Surges to ₹1.47 Trillion in H1 FY27, Driven by Gold and Vehicle Loans

The Indian securitisation market witnessed a remarkable surge in the first half of the financial year 2026-27, with volumes reaching an unprecedented ₹1.47 trillion. This figure represents a 42 percent increase compared to the same period last year, according to data released by ICRA, a leading credit rating agency.

This growth was largely fueled by a significant rise in securitisation transactions linked to gold loans, along with a notable revival in vehicle loan securitisation. Activity in these segments accelerated during the July to September quarter, pushing the half-yearly totals to new heights. By comparison, securitisation volumes stood at ₹1.04 trillion in the first half of FY26.

In the second quarter of FY27 alone, securitisation volumes reached ₹86,000 crore. This uptick was supported by sustained interest in gold loan securitisation, a bounce-back in vehicle lending portfolios, and steady demand in loans related to micro, small, and medium enterprises (MSMEs) as well as business segments.

Gold loans emerged as the key driver for the surge, with securitisation volumes in this category increasing by nearly 50 percent year-on-year. Traditional lending categories including vehicle loans, MSME and business loans, and mortgage loans also posted consistent growth, reflecting a broad-based strengthening of the securitisation market.

Sachin Joglekar, Vice-President and Co-Group Head of Structured Finance Ratings at ICRA, noted that vehicle loans accounted for approximately one-third of overall securitisation volumes in H1 FY27, up from 25 percent in the first quarter. This shift occurred as some lenders re-entered the securitisation market or expanded their sell-down volumes during the second quarter, helping the segment regain ground it had lost previously.

Beyond gold and vehicle loans, other asset classes such as mortgage loans, small business loans, and micro-loans each contributed between 12 and 15 percent of the total securitisation volumes during the half-year period. The distribution of volumes was fairly balanced between pass-through certificates and direct assignment routes, maintaining the pattern observed in the previous quarter.

The ongoing reliance on securitisation by non-banking financial companies (NBFCs) to fulfill their funding needs has played a crucial role in sustaining this growth. By converting loan portfolios into tradable securities, NBFCs have been able to manage liquidity more effectively and support continued credit flow in various sectors.

ICRA’s positive outlook on the securitisation market is reflected in its projection for FY27. The agency anticipates total securitisation volumes to reach at least ₹2.6 to ₹2.7 trillion, which would mark a new record for the Indian financial market. This forecast is underpinned by the strong momentum seen in the first half of the year.

The rise in securitisation activity can be viewed within the broader context of India's evolving financial ecosystem, where alternative financing channels have gained prominence amid shifting regulatory frameworks and changing investor appetite. Securitisation offers an efficient mechanism for lenders to free up capital and expand their lending capacity, thus supporting economic growth.

As sectors like gold loans and vehicle financing rebound, the securitisation market is likely to maintain its upward trajectory. The data from ICRA signals increased confidence among lenders and investors alike, suggesting that securitisation will continue to be a vital tool in India's credit markets throughout the remainder of FY27.