Covid-19 pandemic impact: ICRA downgrades ratings for two MFIs

Rating agency ICRA has cut rating for two MFIs and securitised loan pool on Covid-19 pressures. It downgraded the rating for ASA International India Microfinance’s long term bank lines from "BBB" to "BBB-".  Similarly, it cut ratings on debentures of Jagaran Microfin’s (JMPL) from "BBB-" to "BB+". The rating action factors in the significant increase in delinquencies and the pressure on profitability and growth in light of the Covid-19 pandemic.

It also cut rating for securitised micro-loan pool from "BB" to "BB-" .

It takes into account the considerably lower-than-expected collections from the sub-pool of Sambandh Finserve Private Limited (Sambandh).