EMIs now consume almost entire family income for 60% of borrowers

For many financially stressed households, monthly loan repayments have become so overwhelming that they leave little or no money for everyday expenses, according to a new survey that highlights the growing debt burden among borrowers.The survey by debt resolution platform Expert Panel found that 60% of distressed borrowers said their monthly EMI obligations either matched or exceeded their family's total monthly income. Another 40% said they were repaying existing loans by taking fresh loans or relying on credit cards, indicating that many have fallen into a cycle of debt that is becoming increasingly difficult to escape.The findings are based on inquiries and counselling sessions with borrowers who approached the platform for debt-related assistance.MEDICAL BILLS, JOB LOSSES DRIVING BORROWINGContrary to the perception that loans are largely taken to fund discretionary spending, the survey found that most borrowers had taken loans to meet essential or unavoidable expenses. Medical emergencies accounted for the biggest share of borrowings at 26%, followed by family and personal expenses such as weddings and education at 22%. Another 18% borrowed because of job or business-related challenges, while 15% took loans simply to meet day-to-day household needs.The report suggests that financial shocks, rather than excessive spending, are pushing many households into debt.WHY REPAYMENTS ARE BECOMING DIFFICULT Among those struggling to service their loans, nearly one-third cited job loss or salary reduction as the primary reason for missing repayments.Another 28% said their EMI burden had become too high compared with their income, while 19% blamed multiple loans and over-borrowing. Medical or family emergencies accounted for another 12% of repayment challenges.The survey also found that nearly 60% of borrowers were either making only the minimum payments on their loans or had stopped repayments altogether by the time they sought help. One in five had already received legal notices from lenders.HARASSMENT ADDS TO FINANCIAL STRESSFinancial difficulties are often compounded by aggressive recovery efforts, the survey found.About 35% of borrowers reported facing some form of harassment, while another 17% said they had experienced severe intimidation, including abusive calls, threats and home visits by recovery agents. Many respondents also reported receiving repeated calls from multiple lenders after falling behind on repayments.Commenting on the findings, Anurag Mehra, Director of Expert Panel, said the figures showed that India's debt challenge extends beyond missed repayments."The numbers tell us that India's debt problem is no longer just about missed EMIs—it is about people losing their dignity, peace of mind, and in some cases, even the will to live. Most borrowers we counsel are not habitual defaulters; they are ordinary individuals pushed into financial hardship by medical emergencies, job losses, or unexpected life events," he said.He added that lenders, regulators and policymakers should work towards structured debt resolution mechanisms that protect borrowers from intimidation while ensuring legitimate recovery efforts continue.- EndsPublished On: Jul 24, 2026 17:04 IST