India Microfinance - An Eventful Decade For MFI Industry; Post-Covid Era Looks Promising: ICICI Securities
Despite challenging environment, MFI portfolio grew from Rs 172 billion in FY12 to Rs 2,854 bn in FY22 with 58 mn unique customers
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ICICI Securities Report
The last decade (2012-2022) for Indian microfinance industry has been eventful – withstanding AP crisis, demonetisation, floods, liquidity crisis in 2018 and Covid led disruption.
Despite challenging environment, MFI portfolio grew from Rs 172 billion in FY12 to Rs 2,854 billion (up 16.5 times) in FY22 with 58 million unique customers.
But MFI industry still remains underpenetrated as reflect in only 28.5% penetration at household level (unique customer base at 58 million versus addressable market of 203 million as per Ministry of Finance).
Mfin estimates credit demand for micro loans to reach Rs 17 trillion by FY26 and industry to capture only 32% of the demand at Rs 5.4 trillion by FY26, implying 17% compound annual growth rate for MFI assets under management over FY22-26.
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