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Microfinance loan disbursals rose to ₹76,054 crore in Q2 FY24 from ₹71,916 crore in the year ago period. However, the number of loan disbursements fell to 1.69 crore in Q2 from 1.81 crore loans in the previous year, indicating an increase in the ticket size, MFIN (Microfinance Institutions Network) said in its quarterly report.
Overall microfinance loan portfolio grew 25 per cent y-o-y to ₹3.8-lakh crore as of September 30, covering 7.1 crore unique borrowers with 13.9 crore loan accounts, up 13.9 per cent on-year.
“Growth momentum of the microfinance industry has continued in Q2 FY24, and the portfolio quality has also come near pre-Covid levels with PAR (portfolio at risk) 30 days to 180 days at 2.0 per cent,” said CEO and Director Alok Misra.
MFIN estimates that the microfinance market to grow to ₹13.03-lakh crore by the end of FY24, implying a huge market to be tapped, it said, adding, for sustainable growth, it is imperative that “RBI regulations, especially on income assessment and indebtedness plus industry Code of Conduct tenets, are adhered to in letter and spirit”.
Lender segments
NBFC-MFIs, which constituted 91 lenders, continued to be the largest providers of microcredit with a loan amount outstanding of ₹1.5-lakh crore, accounting for 39.3 per cent of the total industry portfolio. Their AUM grew 39.2 per cent y-o-y to ₹1.3-lakh crore as at the end of September. This included owned portfolio of ₹1.1-lakh crore and off-balance sheet or managed portfolio of ₹24,501 crore.
NBFC-MFIs disbursed loans worth ₹32,732 crore during the quarter to 79.1 lakh accounts compared with ₹28,029 crore worth of 67.5 lakh loans in the previous year. Cumulatively, the segment has a network of 19,513 branches and 1.7 lakh employees.
Banks, with 13 members, had the second largest share of 31.6 per cent with a loans outstanding of ₹1.2 lakh crore. Small finance banks had outstanding loans of ₹73,118 crore comprising 19.4 per cent, whereas NBFCs accounted for 9.1 per cent and other microfinanciers for 0.5 per cent.
East, North-East and South States accounted for 63 per cent of the microfinance portfolio. Bihar continued to lead in terms of loans outstanding, followed by Tamil Nadu and Uttar Pradesh.
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