Vishal Goyal, India Financials Analyst at UBS, said improving liquidity and stable asset quality are helping mid-sized lenders narrow their valuation gap with large banks and non-banking financial companies (NBFCs).

Speaking from the sidelines of UBS India Summit 2025, he said, “Easy liquidity, good asset quality and availability of capital” are giving mid-sized lenders a strong opportunity to perform.

Goyal said lender sentiment at the summit was positive, supported by better demand and a recovery in consumption-driven loans.

“Most lenders are more comfortable lending unsecured once again,” he said, noting that risk appetite has returned after a pause in recent years. Festive demand has also lifted lending activity, though lenders are watching whether this momentum sustains.

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