MFIs Gross Loan Portfolio Stands At Rs 2.24 Lakh Cr In Q2 2020-21

Mumbai, Jan 7: The Gross Loan Portfolio (GLP) of microfinance institutions dipped by 1.15 per cent sequentially to Rs 2,24,000 crore in the quarter ended September 2020, says a report.

"GLP of the microfinance sector stood at Rs 2,24,000 crore in the second quarter of 2020-21, declining by another 1.15 per cent from Q1 of the current fiscal," according to a quarterly report by CRIF High Mark, a credit information bureau. 

Microlenders' GLP stood at Rs 2,26,600 crore in the June quarter. 

Disbursements regained pace in the second quarter, as lending operations resumed in the new normal, witnessing an increase of 380 per cent, reaching Rs 29,700 crore, still one-half of the amount in the same quarter previous year, it said. 

In the second quarter, loans of higher ticket sizes -- above Rs 40,000 -- saw a 10 per cent spike in disbursements over the previous quarter, the report said.

Banks remain the largest lender of microfinance as of September 2020 at 41.8 per cent although having witnessed a decline of 0.5 per cent in GLP over June 2020, it said. 

The sector's early delinquencies by value (portfolio at risk (PAR) 1-30 days past due (DPD)) spiked up to as high as 15.7 per cent as of September 2020, the report said. 

"As of September 2020, early repayment stress (1-30 days past due (DPD)) spiked to 15.7 per cent as borrowers struggled to repay loans, once the moratorium was lifted," it said. This compares with 2.3 per cent in March 2020 and 1.3 per cent in September 2019.   

The Reserve Bank of India (RBI), in March last year, had announced moratorium on repayment of term loans in order to provide relief to borrowers impacted by the COVID-19 related disruptions.     

Initially, the moratorium was allowed till May 31 but was later extended by another three months till August 31.

Micro lenders' portfolio at risk for 31-180 DPD too increased by 1.2 per cent over the previous quarter and stood at 2.6 per cent as of September 2020. PAR for 180+ DPD, however, declined by 10 bps over the previous quarter and stood 1 per cent lower than March 2020, the report said.