Digital Lending Increases Around 40% In Volume And Value In Q2 FY24: Report
Digital loan disbursement volume and value increased 39% and 43%, respectively, year-on-year.
![<div class="paragraphs"><p>(Source: tirachardz/Freepik)</p></div>](https://media.assettype.com/bloombergquint%2F2023-12%2F70da94e9-30c7-46ee-b586-c61bc2c2287f%2Ftop_view_freelance_asian_lady_using_laptop_shopping_online_with_credit_card_table.jpg?auto=format%2Ccompress&w=200)
Digital loan disbursement volumes and value have recorded an annual growth rate of 39% and 43% respectively, according to a recent report by the Fintech Association for Consumer Empowerment. FACE member companies disbursed 2.44 crore loans during the second quarter, an increase of 39% year-on-year and a 10% increase over the previous quarter.
During the first half of the current financial year, member companies reported disbursing over 4.67 crore loans worth Rs 59,365 crore, a 29% increase over the last half-year.
Disbursement value increased 43% in the quarter ended September 2023 to reach Rs 31,692 crore, from Rs 27,673 crore in the same quarter last year. More than three-fourths of the companies reported a positive annual growth over the comparable quarter last year.
Digital lending plays an important role in meeting the credit needs of India's unmet market segments, and recent data signals to strong customer confidence in digital lending, the report said. The report analysed the disbursement data of 37 FACE member companies.
Sugandh Saxena, chief executive officer of FACE, said that the findings indicate “digital lenders’ steadfast commitment to bringing vast unaddressed segments to formal credit with superior experience, choice and convenience.”
“The regulatory foundation and fences are shaping the industry to grow and mature wholesomely, constantly investing and improving customer protection, underwriting models and portfolio quality,” Saxena added.
According to the report, the total assets under management of fintech lending companies was Rs 36,169 crore, with 69% as an on-balance sheet. For non-banking financial companies or companies that own NBFC, 79% of the AUM was on their own balance sheet.
Data on redressal of customer grievances showed that 97% of all customer grievances were resolved within seven days, and 41% were resolved within a day. The biggest reason for customer complaints was credit bureau updates and disputes. Over 25% of complaints were related to credit bureau updates and disputes, followed by app-related grievances (15%) and disclosures (11%).