MSME AUM for NBFCs to cross ¥5.3 lakh crore by FY26: Report

According to a Care Edge report, the MSME Assets Under Management for NBFCs are expected to cross *5.3 lakh crore by FY26. MSME lending has witnessed robust growth in recent years, with NBFCs emerging as the front-runners, outpacing the growth rates of both private and public sector banks.

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Between FY21 and FY24, NBFCs recorded a 32% CAGR in MSME lending, compared to 20.9% for private banks and 10.4% for public sector banks. The share of MSME credit in NBFCs' overall loan portfolio rose from 5.9% in FY21 to 9.1% in H1 FY25, an increase of over 50%. The banks maintained relatively stable MSME exposure, ranging from 16.2% to 16.9% over the same period. The