India’s Gen Z consumers are showing a growing comfort with credit cards and equated monthly instalments (EMIs), while also reporting strong confidence in their ability to achieve long-term financial goals, according to Home Credit India’s 2026 edition of The Great Indian Wallet study.
The findings offer a glimpse into how younger Indian consumers are balancing spending, borrowing and saving as digital financial services and easier access to credit become increasingly common.
According to the study, 64% of Gen Z respondents rely on credit cards or EMIs when purchasing high-value or important products, compared with 62% of respondents overall. At the same time, 63% of Gen Z participants said they feel confident about their future financial goals.
Digital financial tools and easier access to borrowing are also playing a significant role in their outlook. Around 82% of Gen Z respondents believe these services can help them achieve their financial objectives, while 85% expect to accomplish their personal financial goals within the next five years.
Optimism extends beyond individual finances. About 87% of Gen Z respondents believe their overall living conditions will improve in the future.
Gen Z leads savings
While younger consumers are more comfortable using credit for major purchases, the study also indicates that Gen Z is ahead of older generations when it comes to saving.
Around 58% of Gen Z respondents contribute towards savings, compared with 53% among millennials and 44% among Gen X.
The pattern is different when it comes to household expenses. Gen X contributes the highest share towards household spending at 68%, followed by millennials at 68% and Gen Z at 57%, according to the study. Men contribute 67% towards household expenses, compared with 52% for women.
The differences across age groups could partly reflect varying levels of family responsibilities, with older consumers more likely to have larger household financial commitments.
Income and essential spending
The study also highlights differences in income and essential expenses across urban markets. Middle-income households surveyed reported average monthly earnings of around Rs 35,000, against essential monthly expenses of approximately Rs 21,000.
Metropolitan consumers reported the highest average monthly income at about Rs 38,000, along with essential expenses of Rs 22,000. In Tier-1 cities, average monthly income stood at around Rs 33,000, while essential expenses were approximately Rs 20,000.
The figures underline the importance of credit and digital financial products in managing larger purchases while consumers continue to balance everyday expenses and savings.
Home ownership remains a major goal
Despite their willingness to spend on experiences and discretionary purchases, owning a home remains a key financial aspiration among respondents.
About 31% identified buying a home as a major personal financial goal. The aspiration was particularly strong among women, with 40% identifying home ownership as a priority.
Travel also features prominently in discretionary spending. Local trips account for 26% of respondents’ preferred leisure spending, while 22% of Gen Z respondents allocate money towards movies. Around 27% spend on long-distance travel and eating out.
Young consumers show entrepreneurial ambitions
The study also points to a growing interest in entrepreneurship among younger Indians. Around 25% of respondents said they want to start a small business.
Gen Z showed the strongest entrepreneurial inclination, with 31% expressing an interest in starting a business, compared with 19% among Gen X respondents. Men were also somewhat more likely than women to express entrepreneurial ambitions, at 26% and 20%, respectively.
The findings suggest that Gen Z’s financial behaviour is not simply centred on consumption. Alongside greater acceptance of credit-based purchases, the generation is showing a strong focus on savings, home ownership and entrepreneurship.
For lenders and consumer-focused financial companies, this evolving behaviour highlights a generation that is increasingly comfortable with digital finance while remaining focused on building financial security and achieving longer-term goals.
