Digital loan disbursal volumes bounce back after Q3 de-growth: FACE

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After waning growth in the third quarter of fiscal 2013, largely due to regulatory changes, the number of digital loan payments rebounded in the fourth quarter as the industry adjusted to standards, the Fintech Association for Consumer Empowerment) said in a report.

Payment volumes decreased by 10 percent during the third quarter due to the implementation of regulatory changes, shifting to different market segments and business models, and increased ticket volumes. In the fourth quarter, exchange volumes rose 4 percent.

The report, based on data from 35 FACE member companies, said lenders disbursed more than 1.9 crore loans during the quarter, up 61 per cent over the corresponding quarter of the previous year.

This brought total payments volume for FY23 to 7.3 core loans, up 131 percent year-over-year, with all but two companies reporting year-over-year payment growth, with half recording growth of more than 100 percent.

‘Enormous potential’

“These volumes testify to the huge impact and potential of digital lending to provide unsecured loans on a large scale to meet the huge demand for credit for inclusive economic growth,” said FACE.

In terms of value, fourth quarter payments increased 13% quarter-over-quarter compared to 6% growth in the prior quarter. Digital lenders disbursed loans worth INR 27,659 crore in the fourth quarter, up 82 percent from the fourth quarter of FY22.

This took total payments to $92,848 crore for FY23 – about 2.5 times more than FY22. The report said that the exchange value grew by 129 per cent for FY23, with all but two companies reporting growth, adding that the average ​Ticket size continues to be around INR 10,000-12,000.

“Backing on the trend of layoffs in many other technology sectors, fintech lending, in line with business growth, posted 42 percent growth in employment in FY23,” the company said, adding that the share of outside employees continued to rise. one-fifth but decreasing as companies rely more on their employees for customer support and recovery functions.