Loan disbursements by FACE-fintech companies jump 43% in Q2: Report

Fintech Association for Consumer Empowerment (FACE), an industry body for digital lenders, in its eighth edition of FACETS report, stated that the association’s member companies disbursed loans amounting to Rs 31,692 crore in the second quarter of financial year 2024 (Q2 FY24), a 43 per cent year-on-year (Y-o-Y) increase from Rs 22,236 crore in Q2 FY23.

In Q1 FY24, member companies disbursed loans amounting to Rs 29,875 crore.

These companies disbursed around 24.4 million loans in Q2 FY24, marking a 39 per cent Y-o-Y growth in volume from 17.5 million loans in Q2 FY23. In Q1 FY24, fintech companies from the association disbursed 22 million loans.

“Data signals strong customer confidence in digital lending. It reflects digital lenders' steadfast commitment to bringing vast unaddressed segments to formal credit with superior experience, choice, and convenience. The regulatory foundation and fences are shaping the industry to grow and mature wholesomely, constantly investing and improving customer protection, underwriting models, and portfolio quality,” said Sugandh Saxena, chief executive officer, FACE.

Meanwhile, in Q2 FY24, on an aggregated level, the overall average ticket size of loans disbursed grew marginally from Rs 10,209 in Q1 FY24 to Rs 10,591 in Q2 FY24. The average loan ticket size was pegged at Rs 9,954 in Q2 FY23, the report added.

On the complaints or customer grievance redressal side, the report noted that 23 member companies provided customer complaints data. The total volume recorded was over 0.1 million complaints.

Around 99 per cent of complaints were marked as resolved, whereas the rest were reported as pending. Credit limit-related issues, Know Your Customer (KYC), recovery practices, among others, were common complaints that were reported.

Around 29 companies, which accounted for 86 per cent of the disbursement value in H1 FY24, reported an asset-under-management (AUM) of Rs 36,169 crore as of September this year.

The FACETS report has data from 37 FACE member companies which lend to their customers through their non-banking financial companies (NBFCs) and in partnership with other regulated entities (mostly NBFCs).

Out of the 37 companies who contributed with their data, 28 are NBFCs or have in-house NBFCs, the report added.

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