Latest Loan Disbursement Trends To Keep In Mind: FACE unveils Q3 Report for FY 2023-24

The Fintech Association for Consumer Empowerment (FACE), a body aimed at advancing fintech through fair practices, has published the ninth edition of its FACETS report. Shedding light on the sector in Q3 FY23-24, this report covers lending trends for 37 member companies.

Among its many notable findings is that the member companies disbursed nearly ₹2.50 crore loans. This points to a year-on-year growth of 12% from the third quarter of the previous year.

Read on for insights into the trends highlighted by FACE’s report for this quarter.

Trends in Loan Disbursement Volume, Value and Ticket Size

As per the report, the loan disbursement by FACE companies did witness growth in this quarter. However, there was a marginal decline of 0.1% in the disbursement volume from the second quarter.

This decline was directed by one-third of the companies that reported a negative quarter-on-quarter growth. On the other hand, member companies witnessed a 10% growth in Q2 compared to Q1 of this financial year.

Among the 35 member companies:

• 19 member companies reported disbursement volume of less than ₹1 lakh
• 6 member companies reported disbursement volume between ₹1 lakh and ₹5 lakhs
• 4 member companies reported disbursement volume between ₹5 Lakhs and ₹10 lakhs
• 6 member companies reported disbursement volume of over ₹10 lakhs

In total, these companies have disbursed around ₹33,922 crores. This translates into a mammoth 46% increase compared to Q3 of the previous financial year, and a 7% growth from the previous quarter.

Here are the specifics of loan disbursement for 35 FACE member companies in the third quarter of FY 21-22 and FY 22-23, as well as the last 3 quarters:

Of the 35 FACE member companies, two-thirds had an average loan ticket size of over ₹10,000 for the quarter. Only 7 companies had an average loan ticket size of less than ₹10,000.

Growth in AUM and Profitability

Of the 37 companies in the FACETS report, 30 accounted for over 92% of the disbursement value. As of December 2023, these companies also reported an asset under management (AUM) of ₹41,220 crores.

28 FACE member companies also reported their profitability and this data points to growth over the last year.

• 79% of these companies were profitable as per Q3 FY23-24
• 68% of these companies were profitable as per FY22-23

Women’s Participation in Loans Disbursed

India’s lending space is transforming to accommodate more women borrowers as reflected in this report. From April 2023 to December 2023, women accounted for 12% of the total borrowers.

Here’s the detailed breakup.

• 4 companies reported women participation of over 25%
  • 4 companies reported less than 10% of women’s participation
  • 7 companies reported women participation between 15% and 25%
  • 11 companies reported women participation between 15% and 10%

The report also presented data related to the number of the women who were a part of the workforce in these companies, which account for nearly a third of the total employees. However, the data on the presence of women in leadership roles was rather discouraging. Half of the companies that reported the gender composition of their workforce had at least one woman on their Board.

As per Sugandh Saxena, FACE’s CEO, member companies have fared well in the market conditions in the latest quarter. If companies maintain the pace set in Q3, they will likely reach the milestone of ₹10 crore loans disbursed in this financial year.