MICRO LOANS
Budget 2024: For micro, small & medium cos, a major funding boost
The upcoming budget may introduce a scheme to address credit gaps for MSMEs, potentially exceeding ₹10,000 crore. Interventions could include interest subvention and credit guarantees. The aim is to enhance credit access for the sector and promote growth. Stay updated for further developments as the budget approaches.
Budget 2024: MSME ministry seeks additional ₹5,000 crore for job generation scheme
Budget 2024: The government subsidizes a percentage of the loan amount for self-employment ventures, with applicants required to contribute towards the project cost. Despite the high demand, the budget allocation for PMEGP in the current year is lower than the revised estimates for the previous year.
ESAF Small Finance Bank creates micro banking vertical with 5,200 staff
ESAF Small Finance Bank has absorbed 5,200 employees from ESAF Swasraya Multi-State Agro Co-operative Society Ltd (ESMACO) as part of a strategic business restructuring. The bank will now directly manage the microloan portfolio, which was previously managed by ESMACO through banking outlets. The micro banking vertical will primarily serve the needs of the rural population through micro-loans, agriculture loans, vehicle loans, and home loans.
Aye Finance raises $30 million in debt from Dutch development bank
FMO is the Dutch entrepreneurial development bank, with a mission to empower entrepreneurs to build a better world. As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. Aye's net profit in FY24 grew nearly three-fold at Rs 161 crore while revenue was 67% higher at Rs 1072 crores as compared to the numbers in the preceding fiscal.
NBFC-MFIs largest provider of micro-credit: Report
NBFC-MFIs and scheduled banks dominate micro-credit disbursal in India, with NBFC-MFIs leading. The gross loan portfolio for micro-credit reached Rs 4.33 lakh crore by March 31, 2024.
Microfinance market expands by a fourth in FY24 with asset quality showing significant improvement
The microfinance market expanded by a fourth in FY24 with asset quality showing significant improvement. The sector's gross loan portfolio grew 24.5% year-on-year to Rs 4.34 lakh crore at the end of March. The bad loan ratio fell to 7.9% from 8.6% a year back, according to industry data.
Targeting to hit milestone of Rs 20,000 cr loan book in 8-10 quarters: Shachindra Nath
If you look at this, the regulatory intent or the policy intent that the entire banking credit, 40% of average net banking credit should be in the priority sector. As we all know the banking sector, while in recent past the priority sector lending from bank side has improved, but for a variety of reasons the real priority sector credit dissemination has always been done by middle sized NBFCs.
RBI cautions micro finance lenders against usurious interest rates
The Reserve Bank of India (RBI) has warned lenders, particularly in the microfinance sector, against charging "usurious" interest rates by exploiting the regulator's freedom. While most lenders follow guidelines on the Key Facts Statement (KFS), some continue to impose undisclosed fees and high interest rates, particularly on small-value loans provided by microfinance institutions (MFIs) and non-banking financial companies (NBFCs).
Aadhar Housing Finance aims 20% AUM growth in FY25
Aadhar, 76% owned by Blackstone Group Company BCP Topco VII Pte, has a robust asset quality with gross non-performing assets being at just a tad over 1% at the end of March. That compares with 1.16% a year ago.
Muthoot Finance's AUM grows 25% to Rs 89,079 cr in FY24
Muthoot Finance's consolidated assets under management surged 25% YoY to Rs. 89,079 crores in FY24, with a 22% YoY increase in profit after tax to Rs. 4,468 crores. The chairman emphasized a pivot towards non-gold loan growth and digital strategies, aiming to boost subsidiaries' contribution and expand into diverse financial sectors.
Banks' credit growth in FY25 to slow down to 14% on lower GDP uptick, RBI measures: Crisil
Crisil forecasts a 2 percentage point drop in the banking system's credit growth to 14% for the fiscal year 2024-25, citing factors such as lower GDP growth, RBI measures like higher risk weights on unsecured loans, and a high base effect. Slower deposit growth is expected to temper credit expansion, though the fundamental drivers of credit demand remain intact. While corporate segment growth is projected to maintain at 13%, retail growth will slow to 16%.
Fusion MicroFinance to raise $25 mn from DFC
Fusion MicroFinance is raising $25 million from the US International Development Finance Corporation (DFC) for growth capital, following a $20 million loan facility. The micro loan lender has already received $20 million from DFC. Fusion, founded in 2010, has assets under management of Rs 11,476 crore.
L&T Finance aims at 25% CAGR, retail lending in focus
L&T Finance Ltd aims for a 25% compound annual growth rate (CAGR) in the coming years, focusing on strengthening its retail lending business. The financial services arm of Larsen & Toubro plans to exit the wholesale segment entirely by 2026, becoming a 100% retail non-banking financial company (NBFC). The company introduced a new offering, 'Complete Home Loan', signaling a fresh push in its mortgage business, expected to surpass microfinance in book size.
Over 514 million jobs created during 2014-2024
The report is based on 80 case studies covering borrowers who took multiple loans and data of various government schemes.
514 million person years of employment generated in 10 years of the Modi govt: SKOCH
A SKOCH study of 12 central schemes, including the Mahatma Gandhi National Rural Employment Guarantee scheme, the Atmanirbhar Bharat Rozgar Yojana, the Pradhan Mantri Grameen Awas Yojana and the Pradhan Mantri Grameen Sadak Yojana, among others shows that credit gap has fallen 12.1% during the past nine-years.
51.40 crore person-years employment generated during 2014-24: SKOCH Report
A recent SKOCH report revealed that between 2014 and 2024, the Modi government regime generated 51.40 crore person years of employment. The report, titled "Employment Generative Impact of ModiNomics: The Paradigm Shifts," is based on 80 case studies and data from various government schemes. It found that governance-led interventions created 19.79 crore jobs, while credit-led interventions contributed 31.61 crore jobs.
Bandhan Bank in talks to raise $250-million debt from IFC
The Kolkata-based lender is now targeting to grow home loan business along with other retail loans while reducing the share of micro loans, which has been a major stress point for it since Covid-19. The bank had a stress pool of Rs 7,500 crore, largely from the microfinance portfolio built through the joint liability group-based lending model.
Fusion MicroFinance Q4 results: Net profit up 16% to Rs 133 crore
Fusion MicroFinance Q4 results: “We closed a very successful FY24 with the highest ever profit after tax, consistent growth in AUM, healthy return ratios and overall robust operational and financial metrics," managing director Devesh Sachdev was quoted as saying in a note issued by the company.
Belstar Microfin files papers for Rs 1,300-crore IPO
The company is a NBFC-MFI (non-banking finance company - micro finance institution) offering loan products, such as micro enterprise, small enterprise, consumer goods, festival, education and emergency loans, and focuses on the lending model of 'self-help group'. Muthoot Finance owns a 66.13% stake in Belstar.
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