MFI’s gross loan portfolio grows 6.4% to Rs 2.27 lakh crore as of Decemeber 2020: Report

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Mumbai:  The gross loan portfolio of the microfinance sector grew by 6.4% to Rs 2.27 lakh crore as of December 2020 as against Rs 2.13 lakh crore a year ago, according to a report.

The average ticket size of microfinance loans stood at Rs 34,900 in the December quarter of the current fiscal, according to a quarterly report by credit information bureau CRIF High Mark.

Disbursements continued to grow in Q3 FY2020-21, with the resumption of near normalcy in business operations across the country, it said.

“With a nearly 80% increase over the previous quarter (Q2 FY2020-21), disbursements by value stood at Rs 56,090 crore (in Q3 FY 2020-21), which was 11.5% lower than Q3 FY 2019-20,” the report said.

In terms of volume, disbursements in the third quarter almost doubled, compared to the previous quarter standing at 175 lakh and only 4% lower than the same quarter of the previous year, it added.

The share of regional distribution of disbursements remained the same as the previous quarter (Q2FY21), with the eastern region dominating with 35.5%, followed by the southern region (23.4%).

Both rural and urban geographies witnessed 77% growth in disbursements over the previous quarter, it noted.

Early delinquencies by value (portfolio at risk (PAR) 1-30 days past due (DPD) ) reduced by 7.4% in the December quarter this fiscal, the report said.

NBFC MFIs, banks and small finance banks (SFBs) witnessed greater early repayment stress in rural markets compared to urban. High repayment stress in the MFI portfolio from the previous quarter continued in the third quarter with PAR 31-180 DPD at 12.7%, increasing by more than 10%, it said.

Assam and West Bengal witnessed very high stress with PAR 31-180 DPD reaching 23.1% and 22.8%, respectively, in the third quarter.

PAR 180+ stood higher for Assam (7.9%) and Maharashtra (7.6%) compared to other states as of December 2020, it noted.

Banks remained the largest lender of microfinance at 41.8%, followed by NBFC MFIs at 31.8% of the gross loan portfolio and small finance banks (SFBs) at 16.9% as of December 2020, the report said.