Credit and finance for MSMEs: Sticky microfinance loans, which remained unpaid even after 180 days of their due dates (excluding write-offs), increased to 10 per cent — amounting to Rs 31,657 crore — of the total microloan portfolio of Rs 3.16 lakh crore during the December quarter (Q3) of the current fiscal, as per data available in the latest quarterly report on microfinance sector by credit bureau Crif High Mark released on Wednesday.
In a year-on-year (YoY) comparison, the proportion of portfolio delinquent by over 180 days during the December quarter in FY22 was 9.3 per cent — amounting to around Rs 24,524 crore — of Rs 2.63 lakh crore in portfolio outstanding of the microfinance sector. For the September quarter in the current fiscal, loans unpaid beyond 180 days were 9.9 per cent, estimated at Rs 29,700 crore of Rs 3 lakh crore total portfolio microfinance portfolio.
Also read: Microfinance sector’s portfolio delinquent by over 90 days has increased: RBI report
The proportion of portfolio delinquent by more than 180 days past due (excluding write-offs) is calculated as a percentage of the total portfolio outstanding, the report said.
Importantly, loans written off also increased to 6.6 per cent as of December 2022 quarter from 4.4 per cent as of the December 2021 quarter and 6 per cent as of September 2022 quarter.
Comments from Crif High Mark are awaited for this story.
In contrast, the proportion of sticky loans in microfinance unpaid for over 30 days had declined to 3.8 per cent YoY amounting to Rs 12,029 crore as of the December 2022 quarter from 9.2 per cent – Rs 24,260 crore as of the December 2021 quarter and 5.4 per cent – Rs 16,200 crore during September 2022 quarter. Similarly, the proportion of portfolio delinquent by more than 90 days also dropped to 2 per cent – Rs 6,331 crore during the December quarter from 3.7 per cent – Rs 9,756 crore during December 2021 quarter.
Meanwhile, non-banking financial companies (NBFCs) remained the dominant market leader with a share of 35.7 per cent amounting to Rs 1.13 lakh crore in Rs 3.16 lakh crore portfolio followed by banks with 33.5 per cent share worth Rs 1.06 lakh crore and small finance banks with 16.9 per cent share worth Rs 53,343 crore during December quarter. YoY, the share increased by nearly 28.2 per cent for NBFCs, 6.2 per cent for banks, and 17.5 per cent for small finance banks.
In terms of ticket size, loans between Rs 30,000 and Rs 50,000 had the maximum share by value and volume at 45.1 per cent and 42.1 per cent respectively during the December quarter.