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Microfinance loan disbursements above ₹1 lakh jump 89.8%; smaller loans decline
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Microfinance loans of over Rs 1 lakh witnessed an 89.8 per cent jump in disbursements during the June quarter, indicating a strong preference among lenders towards bigger value loans -- considered safer from an asset quality maintenance perspective, a report said on Tuesday.
According to a report by Crif High Mark, there was a 79 per cent jump in the disbursement of loans between Rs 80,000 to Rs 1 lakh during the June quarter, while those under Rs 30,000 declined by 35 per cent and ones between Rs 30-50,000 declined by a fifth.
As per the regulatory definition, a collateral free loan of up to Rs 3 lakh qualifies as a microfinance lending.
Over 77 per cent of the loans above Rs 1 lakh went to existing borrower with the same lender, making clear the prioritisation of asset quality.
The overall portfolio outstanding de-grew 7 per cent on-year to Rs 3.33 lakh crore, but was stable on-quarter, the report said.