Small Finance Banks, banks cede MFI market share to NBFCs

The share of NBFC-MFIs increased from 32% to 37% in the time period

Small finance banks (SFBs) and their larger peers lost market space in the microcredit segment last year, while non-banking finance companies (NBFCs) increased their share.

According to data from Microfinance Institution Network (MFIN), the share of SFBs in microcredit loan outstanding dipped from 22 per cent at the end of December 2017 to about 18 per cent at the end of December 2018.

Also, the share of banks in microfinance loans outstanding decreased from 37 per cent in December 2017 to nearly 32 per cent in December 2018. 

The shift of the microfinance sector from banks to NBFCs has been driven