As of June 30, 2023, the microfinance industry's portfolio increased by 24%
The microfinance industry's outstanding portfolio increased by 24% year-over-year to Rs. 3.6 trillion (US$ 43 billion) as of June 30, according to the most recent report from CRIF High Mark. It increased 5.2% on a sequential basis.
While the gross loan portfolio in rural markets increased by 27.3% over the same period, it increased by roughly 20% in urban markets. According to the report, 83.1% of the gross loan portfolio came from the top 10 states. As of June 30, 2023, Bihar is still the top state.
As per Mr. Sanjeet Dawar, Managing Director of CRIF High Mark, “This growth can largely be attributed to the large-scale adoption of digitisation by the sector as well as the positive regulatory amendments brought in by RBI that have bridged the gap between rural and urban markets.” He added that more chances for micro borrowers to access formal credit and play a major role in the expansion of the economy are anticipated as a result of the microfinance industry's steady growth and the government's push for financial inclusion.
At 145 million, active loans in the sector increased by over 20% on an annual basis. In the June quarter, disbursements increased 19.4% year-over-year to Rs. 67,785 crore (US$ 8.14 billion).
The portfolio of loans overdue by more than 30 days improved from 2.2% to 2% as of June 30. The percentage of the portfolio with loans past due by more than 90 days decreased from 1.1% to 0.9% as of June 30.
Furthermore, as of June 30, NBFC-MFI (non-banking financial corporations-microfinance institutions) has a 40.4% portfolio share, leading the microfinance sector. Banks came in second with a 32.5% share, followed by small financing banks with a 17.2% share.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.