The recent GST rationalization, which simplifies tax slabs and corrects the inverted duty structure, is a highly progressive and timely reform that will significantly boost consumption and support our fast-growing economy. This move will have a meaningful impact on middle-class households, where a large portion of income is spent on daily necessities. By lowering the GST on everyday items like packaged foods, personal care products, and kitchenware to the 5% bracket, families will see a direct reduction in their monthly expenses. We anticipate this will help lower inflation by over a percentage point.

At the consumer level, we expect to see a dual effect. Lower prices will likely lead to increased spending on fast-moving consumer goods (FMCG), durables, and electronics. Additionally, families may choose to use some of their savings to build stronger financial buffers. The timing of this reform, just before the festive season, is particularly significant. It will boost consumer confidence and fuel demand for aspirational purchases, from home appliances to two-wheelers—categories where our EMI financing plays a key role.

For Home Credit India, this signals stronger demand for affordable and transparent financing solutions that help households manage both their essential and aspirational needs.

Beyond the immediate benefits, this reform will have a powerful multiplier effect apart of stimulating demand in supporting industries and reinforcing financial inclusion. This GST rationalisation is more than just a tax simplification; it is a catalyst for long-term economic growth that empowers consumers and strengthens the financial ecosystem.

Vivek Singh , Home Credit India’s CEO