Digital lending volumes rose 131% year-on-year to nearly 73 million in FY23, a report by the Fintech Association for Consumer Empowerment showed on Monday.

“After increasing strongly in the first half of FY23, the disbursement volume degrew during the third quarter but moved to a positive territory in the last quarter,” the report said.

“The drop is a function of variable factors, including individual companies moving to different market segments, increasing ticket size and focusing on regulatory changes,” the Fintech Association for Consumer Empowerment (FACE) said.

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The total value of loans disbursed rose 129% y-o-y to Rs 92,848 crore as on March 31.

“Given the low base and huge demand, the digital lending industry remains in an expansive phase. Growth rates in the disbursement value saw a consistent move upward though the pace of growth decreased in the second half of the year,” the report said.

Barring two, all companies witnessed a rise in disbursement value in 2022-23. The ticket size of digital lenders have ranged from Rs 10,000 to Rs 25,000.

Various technology-focused companies witnessed layoffs in 2022-23 but the employment rate of financial technology companies rose 42% y-o-y, the report said.00

These lenders have gradually been reducing the share of outsourced employees as these companies rely more on employees for customer support and loan recovery functions.

Total number of employees rose 42% y-o-y to 15,326 in 2022-23.

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“The latest data, pleasingly informs us about the vital role fintech lending plays in meeting the huge credit demand. Digital lending guidelines enable responsible growth with companies equally focusing on customer protection, risk management, compliances and governance,” said Sugandh Saxena, chief executive officer of FACE.

“A continuous wholesome investment by companies in these business aspects is an extremely promising sign for the industry’s future. It will progressively lead to a sustainable industry delivering better customer outcomes.”