Microfinance Industry Resilient During Covid with 18 Percent Growth Year on Year

 


Mumbai, Maharashtra, India:
 “Microfinance Plus”, a quarterly publication by Small Industries Development Bank of India (SIDBI) and Equifax revealed growth of 18% in the Microfinance industry portfolio outstanding year on year. Portfolio outstanding in aspirational districts as on March 31, 2021 has grown 185% from December 2017. From the overall industry’s gross loan portfolio, 80% was contributed by top 10 states and West Bengal has the highest outstanding portfolio.

This edition of Microfinance Pulse brings out a comprehensive state profile of the state of Karnataka. Also, the report highlights the impact of Covid-19 on the four geographic zones (North, South, West, East) of the country in terms of disbursals and average ticket sizes.

Key highlights:

  • The book size of microfinance industry as on 31st March 2021, is Rs 249,277 crore, Y-o-Y growth of 18% from March 2020 to March 2021.
  • Microfinance industry disbursed loans worth Rs 93,100 crore during JFM’ 21.
  • Banks have registered the highest Y-o-Y growth of 36% in portfolio outstanding, with consistent increase in market share.
  • 90+ delinquencies for the sector stood at 4.12% as on March 31, 2021 vs 0.86% as on March 31, 2020.
  • The portfolio outstanding of Karnataka stood at Rs 20,330 crore, an increase of 16% from March 2020 to March 2021. Except Karnataka, 90+ delinquency of all the top 10 states has increased in March 2021 compared to March 2020.
  • The zone wise market share analysis in terms of disbursement amount shows that the East zone contributed 45% in total disbursement amount in JFM’21, highest among all zones.

 
On the launch, Shri Sivasubramanian Ramann, Chairman & Managing Director, SIDBI said, “Despite the Covid-19 crisis, the Microfinance portfolio outstanding has shown an impressive Y-o-Y growth of 18%, along with 26% growth in disbursement in JFM’21 as compared to JFM’20. The 90+ delinquency levels which has shown a sharp increase to 4.96% in December 2020 have also moderated to 4.12% in March 2021, showing some signs of easing stress in the sector. Going ahead, the lenders need to carefully monitor the accounts under 1 to 29 DPD levels to avoid further deterioration in asset quality.”

Shri KM Nanaiah, Managing Director, Equifax Credit Information Services Ltd. and Country Leader, Equifax India and MEA said, “We are glad to partner with SIDBI for a report that provides cutting edge analysis to address top of mind questions of practitioners and policymakers. It is heartening to see the resilience of the Microfinance sector in view of Covid-19 and lockdown related challenges.”
 
Microfinance Pulse aims to provide insights on trends in the Indian Microfinance industry – from disbursements to delinquencies to top growing states and top loan categories.

About Equifax

At Equifax (NYSE: EFX), we believe knowledge drives progress. As a global data, analytics, and technology company, we play an essential role in the global economy by helping financial institutions, companies, employers, and government agencies make critical decisions with greater confidence. Our unique blend of differentiated data, analytics, and cloud technology drives insights to power decisions to move people forward. Headquartered in Atlanta and supported by more than 11,000 employees worldwide, Equifax operates or has investments in 24 countries in North America, Central and South America, Europe, and the Asia Pacific region. For more information, visit Equifax.com. For media inquiries, contact [email protected]

About SIDBI

Small Industries Development Bank of India has been established under an Act of the Parliament in 1990. SIDBI is mandated to serve as the Principal Financial Institution for executing the triple agenda of promotion, financing and development of the Micro, Small and Medium Enterprises (MSME sector) and co-ordination of the functions of the various Institutions engaged in similar activities. Over the years, through its various financial and developmental measures, the Bank has touched the lives of people across various strata of the society, impacted enterprises over the entire MSME spectrum and engaged with many credible institutions in the MSME ecosystem.
 
Under Vision 2.0, SIDBI has spearheaded various Initiatives to address the Information Asymmetry in MSME sector like MSME Pulse, the health tracker of MSMEs and CriSidEx, for gauging the MSE sentiments & aspirations, Industry spotlight, a comprehensive report on industry Lenders and Fintech Pulse, for credit data insights on Fintech lending segment, apart from Microfinance Pulse. For more information, please visit:  https://www.sidbi.in/

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