Microfinance industry resilient during Covid with 18% growth year-on-year, says SIDBI-Equifax quarterly publication Microfinance Pulse

“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 of March 31, 2021, has grown 185% from December 2017. From the overall industry’s gross loan portfolio, 80% was contributed by the 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.
  • The microfinance industry disbursed loans worth Rs. 93,100 crores during January, February, March (JFM) 21.
  • Banks have registered the highest Y-o-Ygrowth of 36% in portfolio outstanding, with consistent increase in market share.
  • 90+ delinquencies for the sectorstood 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 and Managing Director of 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 have 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 Days Past Due (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 Covid19 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 SIDBI: Since its formation in 1990, SIDBI has been impacting the lives of citizens across various strata of the society through its integrated, innovative and inclusive approach. Be it traditional, domestic small entrepreneurs, bottom-of-the-pyramid entrepreneurs, to high-end knowledge-based entrepreneurs, SIDBI has directly or indirectly touched the lives of Micro and Small Enterprises (MSEs) through various credit and developmental engagements.
SIDBI 2.0 carries the vision of inclusive, innovative, and impact-oriented engagements.

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Dislciamer : This is an official press release by SIDBI.

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