Microlenders Focuses on Growing Loan Book Size: CRIF Insights
Microlenders are focusing more on growing their loan book size by offering a higher quantum of loans to the same borrowers, and overlooking geographical deepening, a report said on Thursday. The national average ticket size of microfinance loans has been steadily increasing with an increase of 12 percent in June 2019, while the live customer base is growing at a declining pace, credit information company CRIF Highmark said.
The microlenders are considered as important facilitators of deepening the financial inclusion efforts, by helping save people from private moneylenders. "In recent years, especially post-demonetization period, customer retention has assumed priority by way of offering high-value loans while the growth in outreach is sluggish," the company said.
It said the average ticket size has grown to Rs 31,700 from the Rs 31,100 in March and Rs 28,300 in the year-ago period. The live customer base of the microlenders is 5.6 crore, the agency said.
Among the states, West Bengal has the highest incidence of high-value loans with over 45 percent of the borrowers having average outgoings of over Rs 60,000 each, while the same proportion for Tamil Nadu is lowest at 1.8 percent. However, the proportion of multiple lending is the highest in Tamil Nadu with over 6 percent of the borrowers having drawn from four institutions, it said.
From a portfolio perspective, the stressed assets overdue for between 31-180 days have come down to 0.9 percent as against 1 percent in March and 1.2 percent in the year-ago period. The NBFC-MFIs increased their share in the overall microlending by four percentage points to 42 percent as of June as compared to the year-ago period and the same was driven largely by share ceded by banks, it said.