India has witnessed unprecedented infrastructure development over the past decade. A cornerstone of this transformation is the PM GatiShakti National Master Plan (PMGS-NMP)1, launched in October 2021, which adopts an integrated, multimodal approach to infrastructure planning aimed at generating strong growth multipliers. Within this framework, high-quality mass transit systems—particularly metro rail corridors—have emerged as a critical pillar. With rapid expansion across cities, India now boasts the world’s third-largest metro network.
Moving beyond the conventional focus on output and employment multipliers, this paper is among the first to examine how large-scale urban transport infrastructure affects household financial behaviour in India. Using granular home-loan–level data, we assess the impact of metro connectivity on borrower delinquency and prepayment behaviour across urban neighbourhoods. The underlying mechanism is straightforward: improved access to efficient public transport reduces households’ dependence on private vehicles, thereby lowering recurring transportation expenses. This, in turn, eases the burden of servicing EMIs—among the most significant fixed financial commitments for urban households. Our findings reveal economically meaningful improvements in household financial discipline in metro-served areas. In Hyderabad, households located in metro-connected PIN codes exhibit a 1.7% decline in delinquency incidence and a 1.8% increase in prepayment activity. The effects are even stronger in Bengaluru, where delinquency falls by 2.4% and prepayment rises by 3.5%. Evidence from Delhi points to an even larger 4.42% reduction in mortgage delinquency alongside a 1.38% increase in prepayments. Complementary vehicle registration data indicate that these gains are driven by reduced reliance on private automobiles. Beyond improved repayment behaviour, the results also suggest a broad-based reduction in household indebtedness and a decline in average debt burdens. Overall, investments in urban mobility infrastructure over the last decade —particularly metro rail expansion—have translated into stronger household liquidity management and more disciplined borrowing. These behavioural improvements form a critical foundation for household financial resilience and contribute meaningfully to broader financial stability.
