A total of 3,729 K crore in MSME loans have been approved as of March 2022, according to data by CRIF High Mark, a rise of nearly 5 percent over FY21 and 182 percent over FY20.
Total loans sanctioned in FY22 increased by 47% over FY20 to 51.5 lakh accounts. The average ticket size of MSME loans surged by 92% from 37.7 lakh in FY20 to 72.4 lakh in FY21-22. The portfolio of the MSME industry was 22.7 lakh crore, a 36 percent increase over March 2020 and an 18 percent increase over March 21.
90% of the value of originations came from the top 10 states. With an average ticket value of 256.5 lakh in FY22, Maharashtra, Tamil Nadu, and Delhi account for 64% of originations overall followed by West Bengal, Gujarat, Karnataka, Uttar Pradesh, Haryana, Rajasthan and Telangana
In FY22, the top 25 districts accounted for 75% of all originations value. Mumbai, Mumbai Suburban, Chennai, Kolkata, and Bengaluru are the top 5 districts, accounting for around 56 percent of the overall originations value while Bengaluru, Mumbai, Pune, Ahmedabad, and Lucknow were the top 5 districts in terms of Originations volume in FY22.
Public sector banks and NBFCs saw a decline in market share inn FY22, private banks held a 69.8 percent market share by originations value and 33.5 percent by volume.
What was more interesting was that the Portfolio at Risk (PAR) 91-180 Days Past Due (DPD) improved from 1.6 percent as of March 2021 to 1.3 percent, the PAR 181-360 Days DPD remained constant at 0.3 percent, and the PAR 360+ DPD was at 2.2 percent, improving from 2.5 percent as of March 2021. Gurugram’s PAR 91-180 is the lowest at 0.5 percent, while Ahmedabad’s PAR 180+ is the lowest at 1.5 percent.
The active loans for the MSME sector stood at 137.4 lakh, an increase of 7 percent from March 2021 and a 43 percent increase from March 2020.
By originations value, the Small Borrower Segment held the largest market share in FY22 at 28.5 percent, followed by Mudra Segment at 26.2 percent. The Mudra Borrower Segment had the largest market share by originations volume in FY22 at 57.7%, followed by Micro segment at 21.2 percent.
According to Navin Chandani, MD and CEO of CRIF High Mark, “MSMEs are the backbone of the Indian economy, and our data aims to examine the key credit trends emerging for this segment, as we celebrate MSME Day 2022. The fact that total loans given to MSMEs has increased by nearly 50% compared to pre-pandemic levels is a clear indication that the lending community is actively supporting the resilience and regrowth of this sector. We will continue to publish rich data & insights to benefit the lending ecosystem for small businesses.”
The market share of private banks expanded dramatically from 33.6 percent in FY20 to 69.8 percent in FY22, despite the fact that public sector banks and NBFCs saw a fall in their market share during this time. By originations volume, the private banks share increased from 26.9 percent in FY20 to 33.5 percent in FY22 due to a rise in the average ticket size from FY20 to FY22, which went from 47.1 lakh to 150.5 lakh.
In FY22, the average ticket size for Public Sector Banks was 28.6 lakh rupees, NBFCs had a ticket size of 32.1 lakh, Foreign Banks had a ticket size of 502.6 lakh, and Other Lender Types had a ticket size of 26.1 lakh.