Srinagar, June 4 -- In a village near Sopore, a young labourer brought home his first proper paycheck. His parents were proud. The next day, he went out and bought a second-hand motorbike on credit. "He needs it for work," they said. A few months later, he was struggling to pay off the loan. His work slowed, but the repayments didn't.

This story plays out again and again across Kashmir. Men work long hours as masons, drivers, fruit sellers. Women sew, clean, or harvest apples. They earn just enough to get by. But even that gets chipped away by things that feel small at first: a loan here, a risky investment there, maybe a gadget someone said was a "must-have."

In 2022, India's National Centre for Financial Education reported that only 2...