The industry’s outstanding portfolio stood at ₹2.69 lakh crore as of June 2026, down 12% year-on-year. Disbursements during April-June 2026, however, rose 17% to ₹62,302 crore.
Loan sizes also increased during the quarter. Loans above ₹75,000 accounted for 41% of disbursements in April-June, up from 28% a year earlier. At the same time, the share of loans below ₹50,000 declined.
The average loan size increased to ₹62,962 in the April-June quarter from ₹54,681 a year earlier.
The report also showed an improvement in repayment performance. The share of loans overdue by 30 days or more fell to 1.89% in June 2026 from 6.08% in June 2025, a decline of 419 basis points.
Wilfred Sigler, managing director of Equifax India, said the industry was “going through an important phase of recalibration”, with growth increasingly being balanced against portfolio quality. He also emphasised the need for continued data-driven underwriting.
Non-bank microfinance lenders, or NBFC-MFIs, accounted for 47% of the industry’s outstanding portfolio at ₹1.26 lakh crore. They also accounted for nearly 44% of total disbursements during the April-June quarter.
Banks recorded a 37% year-on-year decline in their microfinance portfolios during the period, according to the report.
At the state level, Bihar accounted for the largest share of the industry’s portfolio at 17%, followed by Uttar Pradesh and Tamil Nadu at 12% each.
Over the past five years, the microfinance portfolio in Uttar Pradesh has grown 41%, while Bihar’s portfolio has increased 24%. Delinquency declined across all of the top 10 states during the year, with Odisha recording the lowest delinquency rate at 1.25%.
The report also highlighted higher delinquency among borrowers with exposure to multiple lenders. Borrowers with loans from five or more lenders had a delinquency rate of 10.68%, compared with 3.22% for borrowers with a single lender.
However, delinquency among borrowers with five or more lenders has declined from 23.29% in December 2025.
The 112 Aspirational Districts accounted for 16% of the industry’s portfolio as of June 2026, despite a 7% year-on-year decline in their portfolio. Delinquency in these districts fell to 1.76% from 5.84% a year earlier.
The 28th edition of the SIDBI-Equifax Microfinance Pulse Report indicates a rise in fresh loan disbursements alongside a decline in outstanding portfolio and an improvement in repayment indicators during the quarter.
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