Summary of this article
Tax clarity and fiscal discipline could ease home loan repayment pressure
Stable banking system crucial for sustaining long tenure housing loans
Budget signals on fintech may influence digital home loan access
Home loans are the single largest contributor to retail borrowing, and a sizeable chunk of monthly expenses goes towards paying the equated monthly instalments (EMIs). Policy decisions on income, cost of borrowings, and access to credit directly impinge on family budgets and financial planning.
Shubham Gupta, the co-founder of the investment firm Growthvine Capital, linked household cash flows to tax clarity. “When customers have a defined and transparent direct tax structure, it provides higher disposable income and subsequently encourages consumers to save, invest, and utilise credit responsibly,” he said.
Tax Policy And EMI Affordability
Disposable income plays a key role in how comfortably households manage long-term EMIs. Gupta also pointed to the role of fiscal discipline in keeping borrowing costs manageable. “Maintaining fiscal discipline will keep inflation and borrowing costs low, which directly correlates to the affordability of loans for consumers and the level of confidence that investors have in the companies in which they are investing,” he said.
Beyond direct taxes, he highlighted indirect tax reforms as a factor influencing credit usage and income stability. “The simplification of the Goods and Services Tax (GST) and the development of smoother mechanisms for accessing input credits will eliminate many of the barriers faced by businesses in utilising their credit,” Gupta said, adding that this affects demand for credit and economic activity.
Banking Stability And Loan Servicing
The ability of banks to support housing finance over long tenures depends on funding conditions and risk management. Ranga Reddy, CEO, Maveric Systems, a banking and financial services technology specialist, said lenders are balancing growth with caution. “Demand for loans remains strong, but banks are becoming more careful about how they manage money and risk,” he said.
He pointed to growing operational complexity as banks increase their reliance on digital systems. “As they go increasingly digital and adopt AI, their operations are becoming more complex and harder to manage,” Reddy said.
On the role of policy, he added, “The Budget should support stable funding and smoother flow of credit to keep lending healthy.” He further adds, “Clear and consistent policies can help banks grow faster while staying reliable, transparent, and focused on delivering better outcomes for customers.”
Fintech, Digital Credit, And Household Borrowing
Fintech platforms now play a growing role across the credit lifecycle, including sourcing and servicing retail borrowers. Amit Nigam, executive director and CEO, FindiBANKIT, a digital money transfer service, said the upcoming budget offers scope to strengthen the sector’s contribution to inclusion. “The Union Budget 2026 presents a defining opportunity for India’s fintech ecosystem to scale its impact and global relevance,” he said.
He also highlighted the role of taxation in supporting digital finance. “Meaningful tax relief measures such as rationalised GST on digital financial services and enhanced R&D tax incentives” would help strengthen innovation and expansion, Nigam said.
Cybersecurity And Credit Access
As borrowing and repayments move increasingly online, consumer trust remains central. “A resilient financial security architecture must remain a top priority,” Nigam said, adding that “increased budgetary allocation towards cybersecurity infrastructure and uniform industry-wide security standards will be critical in reinforcing consumer trust.”
On credit inclusion, he said policy support can widen access to formal borrowing. “Policy support for credit inclusion through digital platforms can unlock access to formal credit for millions of underserved Indians,” Nigam said. He continued by saying, “By incentivising alternative credit assessment models and strengthening open banking frameworks, fintechs can play a pivotal role in bridging India’s credit gap in a scalable and responsible manner.”
Household Finances And Long-Term Planning
Across taxation, banking operations, and fintech policy, expert views highlight how structural decisions influence household borrowing. Disposable income, borrowing costs, credit access, and system stability continue to shape how households manage EMIs and plan long-term financial commitments such as home ownership.
