Banks lose microloan market share | India Business News

MUMBAI: Banks have lost significant market share to microfinance companies in small loans over the past year. Commercial and small finance banks, which accounted for about 58% of microloans by December 2020, are now down 55.5% in the market by December 2021. The recession has been taken up by non-banking financial companies – micro finance institutions (micro finance institutions). NBFC-MFIs), which increased their stake from 29.8% to 33.4%.
Even before the loss in market share RBI Liberal lending rules to the sector – lifted the limit on charged interest rates. The new rules are expected to enable NBFC-MFI to become more competitive and gain market share.
According to Microland According to the report, 88.5% of microlending is carried out by banks and NBFCs-MFIs with 11.5% of loans being provided by other lenders. Microland is a quarterly report on microfinance lending published by the credit bureau CRIF High Mark Credit Information Services. In crisis NBFC As a result of the segment, the share of banks increased. However, NBFC-MFI is now recovering lost ground.
As of December 2021, microfinance grew 5.9% quarter-on-quarter and 10.4% year-on-year. However, this was largely due to an increase in loan size as the live customer base QoQ grew by only 0.7%, while the annual growth on the customer base was 1.7%.
During October-December 2021, NBFC-MFI 1.5 crore loan generates loan of Rs. 57,600 crore. As of December 2021, the average balance per account was 4% and the average balance per unique customer was 5.2%.


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