Mumbai, 27th May 2025: CRIF High Mark, a leading credit bureau in India, has released the latest edition of its quarterly publication MicroLend – March’25, offering a detailed view of the microfinance sector’s performance in Q4FY25. The report presents critical insights into disbursement trends, portfolio performance, borrower behaviour, and regional dynamics.
The microfinance industry’s Gross Loan Portfolio (GLP) stood at ₹381.2K crore as of March’25, marking a 2.6% decline Q-o-Q and a 13.9% drop Y-o-Y. This trend reflects a deliberate and calibrated shift by lenders to manage emerging stress, especially in light of regulatory developments and evolving collection practices.
Despite a seasonal rebound with disbursements rising 12.2% Q-o-Q to ₹71.5K crore, Y-o-Y figures remain subdued with a 38.0% decline, signifying an industry-wide emphasis on quality focused originations. Delinquency indicators showed a mixed picture, with early-stage PAR (1–30 days) improving from 1.8% to 1.4% since December 2024, even as longer-term stress (PAR 91–180 and 180+) continued to edge upward.
State-level data revealed notable contractions in Tamil Nadu and Karnataka portfolios, influenced by anticipated ordinances and increased regulatory intervention on collection practices. However, West Bengal, emerged as a bright spot with a 1.5% Q-o-Q rise in portfolio size.
The number of active microfinance loans declined from 16.1 crore in March’24 to 14.0 crore in March’25. Borrowers with 5 or more lender associations now constitute only 4.9% of the total book, down from 9.7% a year ago.
A key trend highlighted in the report is the growing shift toward higher-ticket loans. Portfolio for Loans above ₹1 lakh grew by 38.5 % Y-o-Y, whereas those in the <₹30K segment were at -8.0% Q-o-Q and -35.9% Y-o-Y — underlining a shift away from smaller-ticket lending typically associated with this segment.
Amid these shifts, CRIF High Mark emphasizes that the sector remains on a path of long-term sustainability. While current indicators suggest cautious lending and persistent stress in parts of the portfolio, improvement in early-stage performance and a gradual move towards higher-quality credit segments are encouraging trends.
Commenting on the findings, Ramkumar Gunasekaran, Director and Head of Sales at CRIF High Mark, said: “Lenders are making conscious choices that favour resilience, stability and long-term impact. The 12.2% Q-o-Q rise in disbursements to ₹71,580 crore this quarter, despite broader moderation, reflects continued demand and a disciplined credit approach. As institutions recalibrate and regulatory frameworks evolve, we are confident that the sector is laying the groundwork for stronger and more inclusive growth. With continued focus and collaboration, we remain hopeful that the coming quarters will bring renewed momentum.”
MicroLend is CRIF High Mark’s quarterly flagship report, offering comprehensive data-driven insights into the microfinance lending landscape. It serves as a valuable resource for industry stakeholders to monitor credit trends, assess borrower behaviour, and navigate market shifts effectively.