The microfinance industry (MFIN) is gradually heading towards the pre-COVID levels concerning disbursements and portfolio quality. MFIN mentioned that the loan portfolio pertaining to non-banking financial companies-microfinance institutions (NBFC-MFIs) as of 31 December 2020 stood at Rs 74,712 crore and stood at Rs 67,255 crore a year ago.
MFIN’s gross loan portfolio saw a 10.1% increase on a year-on-year basis at Rs 2,32,648 crore in the third quarter of FY21. Gradually, MFIN loan disbursements are touching the pre-COVID levels due to increased demand for loans.
The top 10 states add up to 82.16% with respect to the Gross Loan Portfolio (GLP). West Bengal regained its position as the largest state regarding portfolio outstanding, succeeded by Tamil Nadu and Bihar. Out of the top 10 states, West Bengal’s average loan outstanding is the highest and is Rs 55,585 per unique borrower. Assam’s average loan outstanding per unique borrower stands at Rs 48,578.
Investors and lenders show complete confidence in the microfinance sector since the debt funding has gone by 10.4% compared to the previous quarter. Equity also has progressed by 16.6% in comparison to the subsequent quarter last year.
14 banks comprise the biggest portfolio share in micro-credit with an overall loan outstanding amount worth Rs 97,956 crore, which constitutes 42.10% of the complete microcredit universe. NBFC-MFIs stands second as the microcredit provider with an outstanding loan amount worth Rs 72,128 crore, including 31% of the overall industry portfolio.
Small finance banks (SFBs) comprise an outstanding loan amount worth Rs 39,062 crore and a total share of 16.79%. NBFCs comprise another 9.06%; other MFIs account for about 1.04% of the universe.
The loan disbursements during Q3FY21 are about 96% of Q3FY20, which brings in anticipation that the loan disbursements could touch normal levels within the end of Q4FY20-21.
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