Satin to target 30% non-MFI share in portfolio

Satin Creditcare Network is doubling down its focus on microfinance lending even as banks and small finance banks remain cautious despite early signs of easing stress.

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Chairman & MD HP Singh tells Narayanan V about the MFI's credit growth, lender's branch expansion, fundraising plans, and the strategy to grow its non-MFI book. Excerpts:

How do you see the stress situation in the MFI sector?

I think the peak of headwinds for the microfinance industry passed in the second half of the previous fiscal. Everyone is now starting from a much better base. With microfinance institutions network's (MFIN) Guardrails 2.0 in place, lenders have been able to better understand the dynamics of where those headwinds usually emanate from. There may still be some talk about over-leveraging, but looking at the overall industry, I believe the worst is behind us. That said, we still need to be cautious about how we approach growth from here. The RBI reducing the qualifying asset requirement for NBFC-MFIs from 75% to 60% is also a huge positive for the industry. It gives us more headroom to extend non-qualifying (non-MFI) loans as well.

How has Guardrails 2.0 worked in your case?