As per RBI data, there are 95 NBFC-MFIs as of August 2019. The Micrometer report by Microfinance Institution Network or MFIN, NBFC-MFIs accounted for around 30 per cent of total micro finance
credit of Rs 1.9 trillion as of June 2019. MFIN is the industry body for NBFC-MFIs in India.
The announcement by RBI is very positive for rural areas. Increased lending limits is expected to help enhance momentum in rural areas and revival of rural economy to some extent, says Udaya Kumar Hebbar, managing director and chief executive officer, CreditAccess Grameen. He also believes that these announcements are in line with inflation and rise in loan requirement by customers.
In light of rising demand for micro credit, the increased lending limits by RBI gives more room for lenders to lend. From Rs 10,000, the average ticket size of MFIs has grown to around Rs 30,000.
Stocks of two listed NBFC-MFIs – CreditAccess Grameen and Spandana Sphoorty Financial gained around 2-4 per cent in Friday’s trading session.