Microfinance Sector Witnesses 21% Portfolio Growth As Of June-End 2023

New Delhi, Oct 10 (KNN) The microfinance sector recorded portfolio growth of 21 per cent at Rs 3.59 lakh crore at the end of June 2023, compared to Rs 2.96 lakh crore at the end of June 2022, as per data from industry body Sa-Dhan.

During the first quarter of FY 2023-24, the portfolio increased by over Rs 7 billion, the data revealed.

During Q1 (April-June) of FY23-24, the total disbursement of all lenders increased by 30 per cent compared with Q1 (April-June) of FY22-23, which was Rs 58,809 crore.

As of April-June 2023-24, Bihar, Tamil Nadu, Uttar Pradesh, Karnataka, and West Bengal accounted for 59 per cent of the total disbursements. Over the past financial year, the amount has increased by 2 per cent.

A Sa-Dhan report found that all lenders, with the exception of not-for-profit institutions, had positive portfolio growth in the first three months of this year.

“For profit” lenders (small finance banks/ SFBs, non-banking finance companies/NBFCs, NBFC-Micro Finance Institutions/ MFIs) recorded significant y-o-y portfolio growth, with NBFC-MFIs recording 43 per cent growth, followed by SFBs and NBFCs at 24 per cent each. Banks’ portfolio growth was at 0.86 per cent.

Jiji Mammen, ED & CEO Sa-Dhan, said, “The microfinance sector is continuing the growth story witnessed during the last financial year (FY).”

“Although the first quarter is usually a dull one for the industry, microfinance continued to perform well, indicating a positive outlook for the year,” added Mammen.

It was noted by Mammen that disbursements in the first quarter amounted to more than Rs 76,000 crore, which is a 30 per cent increase from last year's same period.  (KNN Bureau)