Structural Interventions

Microfinance Pulse

Small Industries Development Bank of India (SIDBI) and Equifax, collaborated to launch a first-of its-kind newsletter “Microfinance Pulse” to track the trends in the microfinance sector viz. disbursements delinquencies, state-wise distribution, top loan categories etc.

This data will act as a lighthouse helping the microfinance industry and policymakers navigate through crests and troughs of lending cycle, so as to ultimately facilitate responsible lending.

Key highlights:

The Microfinance industry clocked 36% Y-o-Y growth in the quarter ending on September 2019. The 4th edition of Microfinance Pulse aims to capture key trends and performance with in-depth views of the Microfinance industry. This shall provide insights in future trends, potential growth opportunities and critical segments across the Microfinance space. This edition also analyzes the “Loan Cycle ID” sourcing and ticket size trends in the industry.

  1. Microfinance Industry Overview: The Microfinance industry has total loan portfolio of `199,688 crore as on September 30, 2019. Banks are the current leaders in the lender category with a total portfolio outstanding of `80,526 crore, which constitutes 40% of the total market share. Also Banks have continued with their dominance in higher value loans, their Average Ticket Size being highest at `36,754 as on September 2019
  2. Disbursement Trends: The industry Average Ticket Size registered 5% growth from the period JAS’18 to JAS’19; loans having ticket size of up to `10K registered the highest growth at 40%
  3. Industry Risk Profile: Risk profile trend shows an increase in industry level 90+ delinquency from 0.40% in September 2018 to 0.43% in September 2019. However, Bihar and Rajasthan are the top states in terms of low 90+ delinquency with Bihar also featuring among the top 3 states in terms of portfolio outstanding
  4. Geographical Exposure: The top 5 states contribute 55% of the pan India portfolio with Tamil Nadu at the top with outstanding of `29,367 crore as on September 2019. Bihar has shown the maximum growth of 55% in portfolio outstanding from September 2018 to September 2019
  5. Aspirational Districts: The number of active Microfinance institutions in Aspirational districts has grown from 117 in December 2017 to 133 in September 2019. Muzaffarpur district in Bihar has shown the highest growth in terms of the number of active Microfinance institutions from 40 in December 2017 to 64 in September 2019. Portfolio outstanding in the Aspirational districts has grown by 101% during the period; at the same time these districts have a 90+ delinquency at 0.41% compared to 0.43% of the industry. The top 3 districts in terms of portfolio outstanding are located in Bihar
  6. State Profile: The comprehensive state profile of Assam provides a snapshot and disbursement trends in the state. Assam has a portfolio of `12,508 crore and over 45 lakh live loans as on September 2019. Kamrup and Nagaon are the top districts in the state and have a share of 23% in the state’s portfolio. The 90+ delinquency of Assam, at 0.28%, stands well below the industry average of 0.43%