Securitisation volumes to dip in Q2 as investors shun unsecured loans

Securitisation activity is likely to stay subdued in Q2FY26, with volumes at Rs 63,000 crore as investors turn cautious on unsecured and microfinance loan pools

Securitisation — the sale of loans through structured transactions — is likely to remain subdued, with volumes estimated at around ₹63,000 crore in the July-September quarter (Q2) of 2025-26 (FY26), compared with ₹70,000 crore during the same period last year.

 

The moderation is driven by a limited pool of loans available for sale in the unsecured and microfinance segments, and by investors being selective amid stress in the retail sector, according to bankers and rating agency analysts.

 

Manushree Saggar, group head of structured finance, Icra, said, “We expect securitisation volumes to be ₹48,000–50,000 crore in Q2FY26.” Activity in the unsecured, micro, small and medium enterprise, and microfinance segments was higher last year (Q2 of 2024-25), but volumes have declined this year due to lower disbursements in these segments.

 

Bankers engaged in securitisation transactions noted that entities from the Reliance group are working on deals worth around ₹13,000 crore backed by receivables. One such transaction is for ₹5,000 crore, with pass-through certificates (PTCs) to be issued by Radhakrishna Securitisation Trust, according to Crisil Ratings. These transactions are originated by Jamnagar Utilities & Power, with the pool backed by loan receivables from Digital Fibre Infrastructure Trust. The PTCs carry an ‘AAA’ rating from Crisil.

 

Regular deals in retail and corporate asset classes, along with proposed transactions from Reliance Industries-promoted entities, are expected to take total securitisation for Q2FY26 to around ₹63,000 crore, bankers said.

 

Saggar added that while sell-down volumes have seen some traction in the microfinance segment, pool selection criteria have become more stringent, and structural features have been enhanced. In terms of asset classes, commercial vehicles are expected to continue dominating the loan mix. Direct assignments could increase, reflecting the impact of co-lending guidelines.

 

Overall securitisation volumes stood at ₹51,000 crore for the first quarter of FY26, with growth largely driven by non-banking financial companies, according to Icra.

 

The securitisation activity is estimated at ₹70,000 crore in the quarter ending Q2FY26, when HDFC Bank was active in offloading loans worth ₹20,000 crore following the merger of its housing finance unit, HDFC, with itself.