Informal borrowing among microfinance customers has collapsed to just 1% in FY25 from 46% in 2011, highlighting a shift in India’s credit landscape over the past decade, according to an MFIN–NCAER study released on Thursday. The survey, covering 10,342 borrowers across 10 states and 19 regulated entities, shows how formal microfinance has steadily displaced high-cost moneylenders. “The key takeaway from this study is the clear shift towards formal credit, with a sharp decline in reliance on informal sources and improved borrower outcomes,” said Alok Misra, chief executive and director, MFIN.