Digital lending plays a vital role in meeting the credit needs of the unaddressed market segments in India. According to a recent report by FACE (Fintech Association for Consumer Empowerment), digital loan disbursement volumes and value recorded an annual growth rate of 39 per cent and 43 per cent, respectively.
Member companies of FACE disbursed 2.44 crore loans during the second quarter of FY24, an increase of 39 per cent compared to Q2 FY23 and a 10 per cent increase over the previous quarter. On a half-yearly basis, during the first half of FY24, member companies reported disbursing over 4.67 crore loans worth Rs 59,365 crore, a 29 per cent increase over the last half-year (H2 FY23).
Disbursement value increased by 43 per cent in Q2 FY24 from Q2 FY23 to reach Rs 31,692 crore compared to Rs 27,673 crore last year. More than three-fourths of the companies reported a positive annual growth over the comparable quarter in FY23. The average ticket size for loans disbursed in Q2 FY24 is Rs 10,591.
The total Asset Under Management (AUM) of fintech lending companies was INR 36,169 crore, with 69 per cent as an on-balance sheet. For companies who are NBFC/own NBFC, 79 per cent of the AUM is on their own balance sheet, said the report.
The report further highlighted that 23 companies provided customer complaints data for H1 FY24 and these companies account for over 80 per cent of disbursement volume in H1 FY24 (disbursing nearly 3.9 crore loans). The total volume reported is a little over a lakh complaints.
However, about 99 per cent of the complaints were reported as resolved and 1 per cent as pending (i.e. open for closure). 41 per cent of complaints were resolved within a day, 97 per cent within seven days. Credit bureau updates/disputes were the biggest reason for customer complaints, followed by app issues and disclosures, the report added.
Over 25 per cent of complaints were related to credit bureau updates and disputes, followed by app-related grievances (15 per cent) and disclosures (11 per cent).
