Signs of stress: Microfinance disbursements fell sharply by 38% in Q4FY25

Microfinance disbursements dropped sharply by 38 per cent in the fourth quarter of financial year 2025 (Q4FY25) when compared to the same quarter of previous year as lenders exercised caution in loan disbursements amid ongoing stress in the segment.

 

But, sequentially, there was a surge of 12.2 per cent in lending due to seasonal factors.

 

According to a report by credit bureau CRIF, disbursements rose 12.2 per cent sequentially to ₹71,580 crore, but were down 38 per cent year-on-year (Y-o-Y) from ₹1.15 trillion.

 

Consequently, the gross loan portfolio shrunk 14 per cent Y-o-Y and 2.6 per cent sequentially to ₹3.81