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Microfinance Sector's Shocking Drop in Risky Borrowers: Is a Major Turnaround Imminent?

Banking/Finance

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Published on 23rd November 2025, 7:10 PM

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Author

Aditi Singh | Whalesbook News Team

Overview

India's microfinance sector is improving as the number of borrowers taking loans from four or more lenders has fallen dramatically. This is due to stricter lending rules, leading to a reduction in risky loan exposure. While it caused short-term cash flow issues, a significant business turnaround for microfinance companies is now expected by the end of fiscal year 2025-26.