Are Indians Using Personal Loans for Home Makeovers This Festive Season? Survey Reveals Changing Spending Habits

The Paisabazaar Festive Spending Report 2025, released in October, shows that home renovation and furnishing have become the top reasons for taking personal loans this festive season.

Every Diwali, new paint and curtains seem to mark the celebration. But this year, many are paying for it with loans. The Paisabazaar Festive Spending Report 2025, released in October, says 18 percent of people took a personal loan for home renovation and furnishing. Out of 10,200 people surveyed, 41 percent were first-time borrowers during the festival months.

These numbers show how personal loans for home renovation trends are changing fast. Borrowing is no longer only for medical or urgent needs. People borrow for furniture, wallpapers, modular kitchens, or even a new air conditioner. That’s how we see it anyway.

Why Are More Indians Borrowing for Home Renovation and Furnishing?

According to the Paisabazaar survey, 42% of borrowers chose lenders for easy processing and quick approval, not the lowest rate.

That tells a story, convenience now wins over cost.
 

The trend shows that digital loans and app-based approvals have made borrowing feel as normal as shopping online.

What the Numbers Say About India’s Festive Borrowing Habits

Across India, festive season personal loan spending habits have moved to shorter EMIs and smaller amounts. Data from LoansJagat, November 2025, shows most people borrowed below ₹5 lakh, and 42 percent chose repayment under five years.

It means people want flexibility, not long commitments. Maybe they’re right, nobody wants a five-year loan for new curtains. The pattern also fits into consumer borrowing for home furnishing expenses, which is common now with one-tap approvals through mobile apps.
 

The government numbers match what private surveys show, more people are borrowing, but not huge amounts. Loans are smaller, quicker, and mainly for lifestyle needs. That’s how the middle class now manages festive pressure.

How This Trend Connects to Earlier Credit Reports

In Instant Loan Apps Redefine Digital Lending in Tier-2 Cities (August 2024), this publication mentioned how small towns were driving credit growth. The new survey on home improvement loan purposes adds another layer. Now it’s not just small-town buyers but also urban families borrowing for home décor.

It shows how digital credit has turned routine. A few clicks, and the sofa dream turns real. Feels strange sometimes, how easy it has become.

How Banks and the Government Are Responding

After the RBI’s 2023 digital lending rules, banks started offering paper-free personal loans under stricter checks. Public banks launched home-upgrade products. Private lenders introduced no-fee festive loans.

The government, through MOSPI and data.gov.in, kept tracking this rise. Reports show household debt growing slowly but steadily. The aim, they said, is to keep borrowing transparent and manageable.

Experts at LoansJagat say people should check EMIs before signing, even for short-term loans. Festivals end, but repayments stay.

Conclusion 

The reasons for taking personal loans during festivals now sound familiar, home paint, furniture, gadgets, or gifts. Borrowing feels normal, part of celebration planning.

These personal loans for home renovation trends may continue into 2026. People want nicer homes, quicker credit, and fewer formalities. And maybe that’s what progress looks like, one room at a time.
 

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About the Author

LoansJagat Team

‘Simplify Finance for Everyone.’ This is the common goal of our team, as we try to explain any topic with relatable examples. From personal to business finance, managing EMIs to becoming debt-free, we do extensive research on each and every parameter, so you don’t have to. Scroll up and have a look at what 15+ years of experience in the BFSI sector looks like.