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Microfinance sector sees 21% growth in FY23
May 31, 2023
India’s microfinance sector has reported 21 per cent year-on-year (YoY) growth in the financial year 2022-23 with the total portfolio across lenders standing at ₹3.51 lakh crore vis-a-vis ₹2.89 lakh crore as of FY22, according to a report by the association for impact finance institutions Sa-Dhan on Monday.
Except for the banks (other than small finance banks or SFBs), which recorded paltry growth of 3 per cent, all other lender types recorded double-digit growth with NBFCs leading the tally at 49 per cent growth followed by 37 per cent growth of NBFC-MFIs. Not-for-profits and SFBs also posted significant growth of 25 per cent and 19 per cent respectively.
NBFC-MFIs topped the microfinance portfolio in FY23 with ₹1.30 lakh crore portfolio size in comparison to banks (₹1.20 lakh crore), SFBs (₹58,431 crore), NBFCs (₹29,664 crore) and not-for-profits (₹3,778 crore).
The loan account volume for the microfinance industry increased by 10 per cent to 13.63 crores in FY23 from 12.39 crores in FY22, while lender-wise figures show NBFCs registered the highest growth of 23 per cent followed by NBFC-MFIs (15 per cent), not-for-profits (6 per cent), banks (6 per cent), and SFBs (5 per cent) respectively.
“The microfinance sector has shown significant performance during the last financial year. The overall growth suggests that the industry has come out of the Covid blues completely and is on a growth path. The new regulatory norms have created a level playing field and it is reflected in the growth of portfolio of NBFC and NBFC MFIs,” said Jiji Mammen, ED & CEO Sa-Dhan.
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