Kolkata, March 16 NBFC-MFIs have surpassed banks to emerge the largest providers of microfinance services in the quarter ended December 31, 2022.

According to the Micrometer report released by MFIN (Microfinance Institutions Network) in Q3 FY-23, 83 NBFC-MFIs were the largest providers of micro-credit, with a loan outstanding of Rs 1,23,386 crore, accounting for nearly 39 per cent of the total industry portfolio, while 13 banks with total loan outstanding of Rs 1,14,546 crore or 36 per cent of total micro-credit loans, held the second largest share.

Small Finance Banks (SFBs) with a loan outstanding of Rs 52,192 crore, accounted for a 16 per cent share, NBFCs accounted for another nine per cent, and other MFIs for one per cent of the total portfolio.

Microfinance loan disbursal

Microfinance loan disbursals grew by nearly 19 per cent at Rs 77,877 crore in Q3 FY23, as compared to Rs 65,392 crore in the same period last year. Close to 189 lakh loans were disbursed in the quarter, as against 165 lakh in Q3 FY-22.

NBFC-MFIs disbursed close to Rs 33,786 crore in Q3 FY-23, as compared to Rs 22,884 crore in the same period last year, registering 47 per cent growth. 

The Gross Loan Portfolio (GLP) stood at Rs 3,20,584 crore as on December 31, 2022, a 25 per cent year-on-year increase over Rs 2,56,058 crore as on December 31, 2021. The microfinance industry served 6.4 crore unique borrowers through 12.6 crore loan accounts.

The GLP of NBFC-MFIs stood at Rs 1,14,969 crore as on December 31, 2022, almost 35 per cent higher than the Rs 85,264 crore on December 31, 2021. The GLP includes owned portfolio of Rs 95,646 crore and managed portfolio of Rs 19,323 crore.

In terms of regional distribution of GLP, the east, north-east and south accounted for 63 per cent of the total portfolio. Bihar was the largest state in terms of portfolio outstanding, followed by Tamil Nadu and West Bengal, the report said.

Microfinance institutions are extending their outreach in states such as Bihar and Uttar Pradesh, with high potential demand.

“The regulatory and policy environment remains conducive and the momentum that the industry has gained over the past one year is favourable. SIDBI’s Udyam Assist Platform will provide a further boost to the sector by mainstreaming informal micro-enterprises that are supported and financed by MFIs,” Dr Alok Misra - CEO & Director, MFIN, said in the report.

comment COMMENT NOW