Published On: Thu, Dec 17th, 2020

Microfinance loan portfolio stands at INR 2,31,778 crores as on September 30, 2020: Micrometer Q2 FY 20-21

New Delhi, Decembe 2020.

Microfinance Institutions Network (MFIN), the microfinance industry association and an RBI recognized self-regulatory organization, today released the 35thissue of its Micrometer report for July to September 2020 i.e. Q2 FY 2020-21.

As on September30, 2020, the microfinance industry served 5.71croreunique borrowers, through 10.50crore loan accounts. The industry currently has a total loan portfolio of INR2,31,778crores, and is showing signs of rebounding to the pre-covid level

Speaking on the occasion, Dr Alok Misra, CEO, MFIN said, “July to September 2020 quarter has witnessed gradual and steady progress in microfinance loan disbursement as also on repayment, compared to earlier April to June 2020 quarter. The full impact is still not seen as September was the first month post moratorium. This rides on regulatory policy initiatives announcedby the RBI and Government of India and ably implemented by microfinance lenders as also the resilience of borrowers. Our Members too have supported microloan borrowers during this unprecedented challenging period, helping them restart credit cycle and rebuild their livelihoods. Though the disbursements are picking up and so is the recovery, there are pockets of COVID stress. It is heartening to note 90 per cent of NBFC-MFIsdisbursement are now through cashless mode. MFIs are also implementing PMSvanidhi scheme as well as MUDRA subvention scheme.

The sector needs continued policy support on pricing regulations post revision of base rate for Q3 and resolution of COVID impacted loan accounts to continue to serve BOP clients.”

From the entire MFI universe, 12 Banks hold the largest share of the portfolio in micro-credit with a total loan outstanding of INR 94,355 crores, which is 40.71 per cent of total micro-credit universe.NBFC-MFIs are the second largest provider of micro-credit with a loan amount outstanding of INR69,933 crores,accounting for 30.17 per cent to total industry portfolio. SFBs have a total loan amount outstanding of INR43,142crores with a total share of 18.61 per cent per cent. NBFCs account for another 9.52 per cent, and other MFIs account for 0.99 per cent of the Universe.

ForMFIN member NBFC-MFIs, the aggregate gross loan portfolio (GLP) stood atINR 71,147 crores as on September 30, 2020, which represents a YoY growth of 12 percent as compared to September 30, 2019,and a contraction of1 per cent over the quarter endingon 30 June 2020. The GLP includes ownedportfolio of Rs 57,270croresandmanagedportfolioofRs13,878crores.

The regionaldistributionofportfolio(GLP),EastandNorthEastaccountsfor34 per cent ofthetotalNBFC-MFIportfolio,South27 per cent,North13 per cent,West16 per cent and Centralcontributes10 per cent.

Fivetopstatesintermsofloanamountoutstandingfor MFIN Member NBFC-MFIsareBihar,TamilNadu,Karnataka,MaharashtraandOdisha.Theyaccountfor51 per cent ofGross Loan Portfolio and the Top10statesaccountfor82 per cent ofthetotalloanamountoutstanding.

During Q2 FY20-21, MFIN Member NBFC-MFIs disbursed 32.26 Lakhs loans amounting to Rs 10,617croresascompared to Q2 FY 19-20, there has been a YoY drop of 52 per cent in number of loans disbursed and 43 per cent in loan amount disbursed.

Top 10 MFIs in terms of loan amount disbursed accounted for 78per cent of industry disbursements in Q2 FY 20-21.

DuringQ2FY20-21,NBFC-MFIsreceivedatotalofRs9,854 croresindebtfunding,whichis4%higherthanQ2FY19-20and65%moreascomparedtoQ1FY20-21.Other Banks contributed to 48.8% of the borrowings received during Q2 FY 20-21, followed by 19.5% from non-bank entities, 15.0% from Top 5 Banks, 14.3% from All India Financial Institutions (AIFIs), External Commercial Borrowings (ECB) and Other sources contributed remaining 2.4%.However, for small MFIs the proportion of lending from AIFIs is just 2.6%, from Top 5 Banks only 6.9% and from other banks 13.5%.

As on September 30,2020, NBFC-MFIs, on an aggregated basis, have a network of 14,080 branches with 1,09,521employees.

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