Seven out of 10 Gen Z consumers had already used some form of credit such as a loan, Buy Now Pay Later (BNPL) service or an EMI plan before getting their first credit card, according to TransUnion CIBIL’s Beyond the Swipe whitepaper (June 2026). For Millennials at the same age, the figure was only about 44%.
The change is clear. In 2018, 56% of Millennials aged 24-30 got their first credit card without any previous borrowing history. By 2024, that share had dropped to just 30% among Gen Z, meaning most young consumers were already using other credit products before adding a credit card to their wallet.
The wallet gets crowded early
Gen Z is not just starting with some credit history, many are already managing multiple loans before getting their first credit card.
According to the whitepaper, 31% of Gen Z consumers already have two or more active credit products when they receive their first card. Around 18% have a consumer durable loan, while 23% are already repaying a small-ticket personal loan.
The borrowing doesn’t stop there. Within a year of getting their first credit card, 69% of Gen Z consumers take another credit product, compared with 55% of Millennials at the same stage. The study also found that about one in every two first-time Gen Z cardholders gets a second credit card within 12 months.
Researchers studying Gen Z’s borrowing habits point to a mix of economic, technological and behavioural factors that have made debt feel more routine than risky for India’s youngest borrowers.
Plethora of borrowing options
Young Indians now have a wide range of borrowing options, including credit cards, BNPL services and personal loans offered through digital lending apps, according to a study titled “Exploring Financial Behaviour Among Millennials and Gen Z in India”, published in the International Journal for Multidisciplinary Research (IJMR) in April 2025.
For many, a credit card is no longer their first borrowing experience but simply another product added to an existing credit portfolio.
BNPL services split purchases into installments, reducing the pain of paying upfront. Research on BNPL adoption among Gen Z e-commerce shoppers, also published in the International Journal for Multidisciplinary Research—found makes borrowing feel almost effortless. Many young consumers, the study notes, end up taking on their first loan-like product “almost accidentally”, just by shopping online, well before they ever fill out a credit card application.
Credit is seen as useful, not risky
The BNPL study found that convenience, rather than caution, drives adoption. Gen Z consumers tend to judge credit products by how easily they fit into daily life, such as enabling faster checkouts and smoother payments, rather than viewing them primarily as debt. Even when they understand the risks, speed and convenience often outweigh concerns.
Fintech access cuts both ways. Digital lending has “expedited financial inclusion” but can also “precipitate debt accumulation and stress when users underestimate repayment obligations,” according to the Millennials-and-Gen-Z study. Easy access, in other words, is precisely why credit exposure now builds up faster and earlier than it did for the previous generation.
Peer pressure and finfluencers
The same research found that Gen Z’s financial decisions are strongly influenced by content creators on YouTube, Instagram and TikTok, as well as peer comparison and fear of missing out (FOMO). These factors encourage many young consumers to adopt new credit products because others in their social circles already use them.
Millennials entered adulthood during the 2008 global financial crisis and later experienced the pandemic, events that researchers say encouraged greater caution towards debt and a stronger focus on saving. Gen Z, by contrast, grew up in a more digital, credit-rich environment and has no adult memory of the 2008 crisis, making them more comfortable with borrowing.
Behavioural economics offers another explanation: present bias, or the tendency to prioritise immediate rewards over long-term consequences. The research suggests this trait is more pronounced among Gen Z than Millennials, whose financial behaviour was shaped by the more cautious post-2008 environment.
A generation with a head-start, and a different kind of risk
None of this means Gen Z is necessarily worse with money, TransUnion CIBIL’s data shows young cardholders are actually more likely than Millennials were to “graduate” into healthier, diversified credit use within two years of their first card.
But it does mean the credit card industry is dealing with a fundamentally different kind of new customer: one who doesn’t arrive as a blank slate, but as someone already juggling BNPL installments, small personal loans and EMI plans before the first card statement even lands.
As the whitepaper puts it, lenders will need to move from product-led thinking to lifecycle-led strategy, because for Gen Z, the credit card was never really the beginning of the story.