After de-growing in Q3 FY23, largely due to regulatory changes, the number of digital loan disbursals bounced back in Q4 as the industry adapted to the norms, FACE (Fintech Association for Consumer Empowerment) said in a report.
Disbursement volumes de-grew 10 per cent during the third quarter owing to implementation of regulatory changes, shift to different market segments and business models, and increasing ticket sizes. In Q4, disbursement volumes were up 4 per cent.
The report, based on data from 35 FACE member companies, said lenders disbursed over 1.9 crore loans during the quarter, 61 per cent higher compared with the corresponding quarter of the previous year.
This took total volume of disbursements for FY23 to 7.3 core loans, up 131 per cent year-on-year, with all but two companies reporting growth in disbursements y-o-y and half of them reporting over 100 per cent growth.
‘Huge potential’
“These volumes testify to the huge impact and potential of digital lending to provide unsecured loans at scale to meet the massive credit demand for inclusive economic growth,” FACE said.
In terms of value, Q4 disbursements were 13 per cent higher quarter-on-quarter compared with a 6 per cent growth in the previous quarter. Digital lenders disbursed loans worth ₹27,659 crore in Q4, 82 per cent higher than Q4FY22.
This took total disbursements to ₹92,848 crore for FY23—around 2.5 fold higher compared with FY22. Disbursement value grew 129 per cent for FY23, with all except two companies reporting a growth, the report said, adding that average ticket size continued to be around ₹10,000-12,000.
“Bucking the lay-off trend of many other-tech sectors, fintech lending, in line with business growth, reported a 42 per cent growth in employment in FY23,” it said, adding that the share of out-sourced employees continued to be a fifth but is reducing as companies rely more on their employees for customer support and recovery functions.