India’s MSME loan portfolio grew 17.8% to Rs 64.1 lakh crore by March 2024, according to CRIF High Mark’s How India Lends report. This includes loans to entities with up to Rs 50 crore credit exposure and self-employed individuals. Loans to self-employed individuals surged 28.9% to Rs 35.7 lakh crore, while loans to MSME entities grew 6.6% to Rs 28.4 lakh crore.
In FY24, 2.74 crore MSME loans worth Rs 54.2 lakh crore were originated or sanctioned, marking a 19.3% increase in volume and a 5.4% rise in amount. Entity MSMEs experienced a 3.1% YoY growth in origination value and an 18.9% increase in volume. Individual MSMEs saw a 12.6% YoY growth in origination value and a 19.4% rise in volume.
In terms of portfolio quality, individual MSMEs saw significant improvement in delinquency rates, with PAR 31-90 (portfolio at risk by 31-90 days) improving to 2.7% in March 2024 from 3% in March 2023. PAR 91-180, PAR 181-360, and PAR 360+ also improved to 1.1%, 0.7%, and 7.3%, respectively, by March 2024.
Conversely, the entity MSME segment experienced a decline in portfolio quality, with PAR 31-90 rising to 2.5% and PAR 91-180 increasing to 1.1% in March 2024, compared to 2.1% and 1% in March 2023.
The microfinance loan portfolio grew 26.8% to Rs 4.4 lakh crore in FY24, while origination volume increased by 6% to 8.35 crore, involving Rs 3.8 lakh crore, a 19% growth.