Remote lending channels are expanding primarily due to the technological capabilities of large companies. Over the quarter, the proportion of online loans issued by microfinance organizations (MFOs) grew from 81% to 84%, and in the segment of payday loans, they accounted for 96%.
The portfolio of MFO loans continued to grow (+7% quarter-on-quarter) amid higher consumer demand. Companies adapted to regulatory restrictions and increased the supply of medium-term loans. Most such loans are comparable with short-term facilities in terms of loan amount and effective interest rate.
The business microfinance market grew rapidly: over the quarter, the amount of loans issued to small and medium-sized enterprises (SMEs) was up by 22%, driven by demand from marketplace companies.
To improve the availability of microloans for SMEs, the Bank of Russia is discussing with market participants the possibility of creating a separate MFO segment consisting of companies engaged in business financing. For such companies, the regulator may lift the limit on the maximum loan amount and expand funding sources.
More details are available in the Review of Key Indicators of Microfinance Organisations for 2024 Q2.
Preview photo: Chalrumpon Onnongwa / Shutterstock / Fotodom