Led by increased lending by private sector banks, loans disbursed to MSME sector grew by a massive 182% in FY22 to Rs 37 trillion as compared to the pre-covid levels, as per a study conducted by credit bureau CRIF High Mark. Market share of loans of private banks to MSMEs, both in value and volume terms, increased at the cost of public sector banks.
In terms of value, loan disbursal of private banks increased from 33.6% in FY20 to 69.8% in FY22. Share of private banks increased from 26.9% in FY20 to 33.5% in FY22 in volume terms.
The average ticket size of MSME loans grew to Rs 72.4 lakhs from Rs 37.7 lakh in FY20, translating to an increase of 92%. For private banks, average ticket size rose from Rs 47.1 lakh in FY20 to Rs 150.5 lakh in FY22. The average ticket size for public sector banks in FY22 stood at Rs 28.6 lakh and that for NBFCs was at Rs 32.1 lakh.
Geographically, top 3 states Maharashtra, Tamil Nadu, and Delhi, make up 64% of the total originations value in FY22, the report said. As per originations volume, Maharashtra, Tamil Nadu, and Uttar Pradesh are the top 3 states and with an average ticket size of Rs 256.5 lakh in FY22. Maharashtra has the largest MSME loan portfolio.
Of the total originations in FY22, 75% came from the top 25 districts. The top 5 districts are Mumbai, Mumbai Suburban, Chennai, Kolkata, and Bengaluru, making about 56% of the total originations value in FY22. In originations volume terms, the top 5 districts in FY22 were Bengaluru, Mumbai, Pune, Ahmedabad, and Lucknow.