New Delhi, July 29 (IANS): Contributing to India’s digital inclusion, fintech Non-Bank Financial Companies (NBFCs) sanctioned nearly 9 crore loans worth Rs 98,111 crore in FY24, doubling their share in six years, a report showed on Monday.
This accounts for 65 per cent of loan sanction volume and 11 per cent of the loan sanction value in the overall personal loan market in FY24, according to leading industry body, the Fintech Association for Consumer Empowerment (FACE).
From FY19 to FY24, fintech loans' share in sanction volume increased from 30 per cent to 65 per cent and in sanction value from 4 per cent to 11 per cent.
“An expanding digital economy nurtured by public policy, infra and regulations creates fertile ground. The backdrop is moving - customer needs, regulations, technology, funding position. Technological developments, in particular, bring new prospects and risks,” said Sugandh Saxena, CEO, FACE.
Despite the pandemic setbacks, the industry disbursed over 24 crore loans worth Rs 2.7 lakh crore since April 2018.
The outstanding loan volume for fintech personal loans was 4.84 crore with a total value of Rs 70,049 crore (as of March 2024).
This represents fintech NBFCs share of 5 per cent in overall personal loan outstanding and over a third in active loan volumes, said the FACE data.
“The digital process breaks the geographical barriers to access, and the data shows that fintech borrowers come from 717 districts in 35 states/UTs,” the report mentioned.
Over two-thirds of loans by sanction value in FY 23-24 went to borrowers under the age of 35.
Fintech primarily serves the vast aspirational mass market with an annual family income of Rs 3-12 lakh.
These customers require a spectrum of credit products, and the fintech loan ticket size composition reflects that, said the report.
At an aggregate level, fintechs have an average ticket size of about Rs 11,000 and half of the sanction value goes to ticket sizes under Rs 50,000.
“Fintech's ability to capitalise on technology to improve customer experience and business conduct and prevent risks and fraud is mission critical for success ahead,” said Saxena.