Loyalty Blogs

Getting a customer to borrow once is easy. Getting them to come back again? That is the real challenge.  

In the era of fast-moving lending space, where one app offers instant credit and another promises zero paperwork, Indian NBFCs (Non-Banking Financial Companies) are realizing that winning trust is more valuable than winning transactions. With customer acquisition costs at an all-time high, smart lenders are shifting their focus from chasing new borrowers to nurturing the ones they already have.  

So, how do you keep borrowers coming back into a market that is flooded with choices? 

The answer lies in loyalty programs, but not the outdated kind with dusty reward points no one redeems. We are talking about modern, personalized, and purpose-driven loyalty strategies that turn repayment into a rewarding experience and every loan cycle into a relationship. 

In this blog, we will explore how platforms like Novus Loyalty are helping them lead with data, empathy, and results.  

The Growing Challenge: Retain or Risk Losing 

According to CRIF High Mark’s 2023 report, India saw over $68 billion disbursed by NBFCs, with nearly 47% of it driven by repeat customers. However, this number has started to plateau. 

So, what is happening? 

• Customer loyalty is fragile. Fintech apps and digital lenders offer flashy deals, faster approvals, and instant gratification. 

• Borrowers switch easily. Over 60% of consumers say they would switch lenders if offered better rewards or benefits, especially in the unsecured loan segment. 

• Engagement is shallow. NBFCs traditionally focus on disbursement, not relationship-building, leading to high churn. 

Loyalty in Lending: A Shift in Thinking 

Traditionally, loyalty programs were the domain of airlines, credit cards, and retail. But NBFCs are now realizing that repeat lending is a behavioral outcome, and behavior can be influenced by consistent, relevant, and rewarding engagement.  

Here is how the shift is playing out: 

1. From Points to Purpose 

Generic cashback and reward points are not enough anymore. NBFCs are embracing goal-based rewards, offering borrowers incentives for financial discipline, timely repayments, and digital engagement. 

2. From Campaigns to Journeys 

Instead of sporadic marketing campaigns, the new-age NBFC is focused on lifecycle loyalty, rewarding borrowers across milestones, from onboarding and KYC to repayment and renewals.  

3. From Segments to Personalization 

Using behavioral data, AI/ML, and platforms like Novus Loyalty, NBFCs are customizing rewards to customer personas: first-time borrowers, gig workers, MSMEs, or salaried professionals. 

5 Powerful Ways Indian NBFCs are Driving Repeat Borrowing Through Loyalty 

Let’s break down the five most effective strategies successful NBFCs are using to increase repeat borrowing through loyalty: 

 1. Rewarding Timely Repayments 

Late payments are a major concern for lenders. To address this, NBFCs are rewarding borrowers for: 

• On-time EMIs 

• Pre-closure of Loans 

• Auto-debit opt-ins 

For example, an NBFC offering small-ticket loans saw a 22% improvement in on-time repayments after introducing tier-based rewards powered by Novus Loyalty. 

2. Gamifying Financial Discipline 

Gamification is not just for e-commerce. Lenders are using it to: 

• Celebrate “Repayments Streaks.”  

• Offer badges for credit health.  

• Run a leaderboard contest among regions or cohorts. 

This approach not only boosts engagement but also encourages repeat borrowing behavior in a more emotionally engaging way. 

3. Cross-Selling With Relevant Offers 

A borrower who took out an education loan might be interested in a home loan or a top-up after a year. With data-backed insights and loyalty triggers, NBFCs can now: 

• Predict borrower needs 

• Offer pre-approved offers 

• Reward upgrades or cross-sells with personalized benefits.  

Novus Loyalty allows such personalized campaigns at scale, helping NBFCs lower cost per acquisition while deepening customer value. 

4. Celebrating Milestones and Moments 

Emotional connection plays a huge role in borrower trust. Savvy NBFCs now reward: 

• Loan completion anniversaries 

• First successful repayment 

• Digital engagement (like app download or referrals) 

This kind of lifecycle marketing has shown a 19% increase in borrower retention, especially among Gen Z and millennial users. 

5. Creating Exclusive Loyalty Tiers 

Just like airline platinum members, borrowers now enjoy status-based rewards: 

• Silver/Gold/Platinum Tiers 

• Access to lower interest rates 

• Faster disbursals or higher loan limits 

Platforms like Novus Loyalty enable NBFCs to configure and manage those loyalty tiers with full flexibility, ensuring better retention, lower delinquency, and increased lifetime value. 

Real Impact: What the Number Say 

The benefits of well-designed NBFC loyalty programs are not theoretical. Here is what real-world data shows: 

• Up to 30% increase in repeat loan applications 

• 20-25% drop in early churn rates 

• 18% higher CLTV (Customer Lifetime Value) 

• 3x ROI on loyalty program investments within 12 months.  

In one case, a mid-sized NBFC using Novus Loyalty reported: 

• A 27% increase in borrower engagement within the first quarter 

• A 15% rise in cross-sell conversions 

• Better credit behavior among loyalty tier members. 

Why This Works: The Psychological Play 

Loyalty in lending is not just transactional; it is deeply psychological. Here is why these programs work so well: 

• Recognition breeds retention. Customers stay where they feel valued, not just processed.  

• Gamification triggers dopamine. Small wins create big emotions. 

• Trust reduces friction. Borrowers return to lenders who understand their journey, not just their score. 

The Role of Novus Loyalty: Powering the Shift 

While NBFCs understand the “why,” many struggle with the ” how.” Legacy systems, fragmented data, and limited tech bandwidth often get in the way of building a scalable loyalty engine. 

That is where Novus Loyalty comes in. 

Novus provides a plug-and-play, no-code loyalty platform customized for NBFCs. With features like 

• Real-time reward configuration 

• Omnichannel engagement tools 

• Dynamic tier and rule engines 

• CRM and core lending integrations 

• NBFCs can finally run loyally like a pro, without overloading their IT teams. 

Whether it is rewarding first-time borrowers, nudging app adoption, or building lifetime value, Novus Loyalty gives NBFCs everything they require to build trust, repeat behavior, and outperform the competition. 

What is Next: Loyalty Will Define the Future of Lending 

In a world where customer trust is currency and switching is easier than staying, loyalty programs are no longer optional for NBFCs; they are strategic necessities. 

As India’s lending landscape grows more digital, data-driven, and experience-focused, the lenders that will thrive are those that 

• Go beyond disbursement 

• Invest in long-term value 

• Personalize every interaction. 

• Reward every good decision 

With a partner like Novus Loyalty, the future of repeat borrowing does not just look bright; it looks deeply rewarding. 

Conclusion: Loyalty is not a Program but a Promise 

It is all about people. At the end of the day, lending is not about figures, approvals, and disbursal. Loans have a story: the dream student, the entrepreneurial shopkeeper, and the aspiring homeowner creating a young family. And in a lending environment, where the borrowers have numerous options to borrow money, they will keep in mind the NBFC that not only gave them the money but also gave them a feeling that they mattered. 

Shall we say that is the strength of a designed loyalty initiative? 

Through honoring good financial health, incentivizing trust, and humanizing the path of the borrower, NBFCs are not just lenders anymore; they are becoming part of the long-term financial life of their customers. 

But now, with such an adaptable yet intelligent platform as Novus Loyalty, this transition is possible and profitable. Whether it is lowering churn or boosting lifetime value, Novus helps NBFCs to develop a program that really matters to people.