Microfinance industry holds strong with stable year-on-year growth: SIDBI-Equifax report


The tenth edition of “Microfinance Pulse”, a quarterly publication of the Small Industries Development Bank of India (SIDBI) and Equifax India, revealed that the microfinance industry’s outstanding portfolio remained stable year-over-year in June. 2021.

The outstanding portfolio of Microfinance Industry was Rs. 2,22,060 crore in June 2021.

The microfinance industry disbursed loans worth Rs. 25,808 crore in the April-June 2021 quarter, recording solid year-on-year growth of 300% in value and 209% in volume. However, 1 to 179 days of late payments increased in June 2021 to reach 31.44% from 13.59% in March 2021. West Bengal, Tamil Nadu, Bihar, Karnataka and Uttar Pradesh were the Top 5 states in June 2021.

West Bengal is the top state with an outstanding wallet of Rs. 31,024 crore, however, West Bengal’s 90+ day delinquency was 5.15% which is the highest among the top 5 states and also higher than industry 90+ delinquency of 3.01%.

Analysis of the distribution of borrowers by number of loans and outstanding portfolio shows that 42% of clients have three or more loans and only 15% of borrowers have outstanding portfolio exceeding Rs. 50,000.

At the launch, Sivasubramanian Ramann, President and CEO of SIDBI, said: “Disbursements during the quarter from April to June 2021 were impacted due to the second wave of the pandemic. However, the impact was less severe compared to the first wave of the pandemic, reflecting the resilience of the microfinance sector. Although the sector has stood up to the challenges, the levels of 1 to 29 days late (DPD) and 30 to 59 (DPD) have risen sharply, indicating the first signs of portfolio strain and leading to an alarming overall increase in investment levels. DPD. Going forward, lenders should carefully monitor the microfinance portfolio to avoid further deterioration in asset quality.

At the launch, KM Nanaiah, Managing Director, Equifax Credit Information services Pvt. Ltd. and Country Leader, Equifax India and MEA said: “The tenth edition of the Microfinance Pulse report in collaboration with SIDBI provides cutting-edge analysis to answer key questions from practitioners and policymakers. During a difficult year, the microfinance industry held its own, remaining stable year-on-year with remarkable growth in disbursements in the quarter ending June 2021. Banks have led this story of growth in disbursements with a 57% share among lenders.

Microfinance Pulse aims to provide information on trends in India’s microfinance industry – from disbursements and delinquencies to the fastest growing states and major loan categories. The report is published in 12 vernacular languages ​​in addition to Hindi and English.

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Posted: Tuesday November 23, 2021 11:37 IST


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