Muthoot Microfin is looking to bring down the share of microfinance joint liability group (JLG) loans to 65% of its portfolio from 85% as part of its asset diversification strategy. It will focus on high-quality individual loans and secured products such as loan against property and gold loans.
“In the medium term, we want to have around 85:15 mix between JLG and non-JLG loans. In the long run, we are aiming to have a 65:35 mix,” Sadaf Sayeed, managing director and chief executive, said.
₹2,492 crore disbursed in Q3
The NBFC-MFI disbursed ₹2,492 crore in Q3, driven by ₹874 crore in disbursements for ‘Muthoot Small & Growing’ individual loans. “Every month, almost 50% of disbursements are towards individual loans and the remaining to JLG loans,” Sayeed said.
We are doing a cash flow assessment, verifying income sources of borrowers and graduating them to individual loans from JLG,” he said. The average ticket size of individual loans is ₹1.8 lakh, against ₹70,000 for JLG loans.
The NBFC-MFI is also focusing on micro LAP and gold loans, which together have grown to ₹100 crore.
Improvement in collections
The company is also seeing an improvement in collections – overall collection efficiency has improved by 150 bps to 94.8%, with on-time X bucket collection efficiency at 99.8%. “The repayment is really improving because of the improvement in underlying economic activities and good cash flows after the monsoon,” he said.
Muthoot Microfin disbursed more than ₹6,500 crore for the nine-month period ended December 2025. Sayeed said the company clocked around ₹960 crore of disbursement in January, and February continues to be strong. “We would do in excess of ₹3,300 crore in Q4, so we would be close to ₹10,000 crore of disbursements for the full year.”
Muthoot Microfin is aiming to close FY26 with ₹14,000 crore of assets under management, growing at 14% year-on-year. “Our guidance was 5%-10% but we will overachieve that.”
The company has board approval to raise ₹2,000 crore through NCDs over the next two-three quarters. For the current fiscal, it would raise ₹2,500 crore through NCDs, pass-through certificates and bank term loans.