The gross loan portfolio of pureplay microfinance institutions (MFIs) rose 53% to Rs 51,878 crore for the April-June period from Rs 33,950 crore in the corresponding quarter last year, said a report by Microfinance Institutions Network (MFIN).
Gross loan portfolio comprises of net and managed loans. Net loans, which are made by MFIs, show on the balance sheet of microlenders. Managed loans do not show on the balance sheet of MFIs. Under this category of loans, banks issue credit which is distributed by microlenders. Also, loans that are sold off (securitised) by microlenders to other financial institutions are known as managed loans.
The report, which covers 48 pureplay microlenders, shows that the managed portfolio of MFIs stands at Rs 9,226 crore for the April-June period, up from Rs 4,990 crore a year before. All 48 microlenders are members of MFIN.
Citing non-availability of latest data for some microlenders, the report takes January-March numbers for Spandana Sphoorty, Arohan Financial and Muthoot Microfin, and July-September figures for CreditAccess Grameen.
All these four companies are among the top 10 microlenders in the country by gross loans.
The MFIs have disbursed loans worth of Rs 17,836 crore for the April-June period, with cashless disbursements accounting for Rs 11,404 crore.
“Microfinance industry has gained pace, showcasing promising growth in the past quarters,” said Harsh Shrivastava, chief executive of MFIN, in a release.
“As we see more players entering the space and the current ones growing larger and realising their IPO (initial public offering) plans, the coming period will mark a new chapter for the sector,” said Shrivastava.
Last week, the shares of microlender CreditAccess Grameen, which operates under the Grameen Koota brand, began trading on the bourses. The microlender made a weak debut on the stock exchanges, with its shares falling as much as 9% before recovering some losses.
Spandana Sphoorty is looking to float its IPO. Kedaara Capital, venture capital firm Helion Venture Partners and strategic investor Valiant Mauritius Partners FDI Ltd are looking to partly exit Spandana in the IPO.
Mumbai-listed Bharat Financial Inclusion is the largest MFI in the country by gross loans and loan disbursements. As on 30 June, its gross loan portfolio stood at Rs 13,832 crore, up from Rs 12,594 as on March-end.
In one of the major deals in the sector in October 2017, private lender IndusInd Bank agreed to buy Bharat Financial Inclusion in an all-stock deal.
In terms of regions, Karnataka had the highest share of the gross loan portfolio at Rs 6,259 crore as on 30 June. It also topped in terms of loan disbursement at Rs 2,219 crore for the quarter ended June.