Overdue loans in MFO segment decrease: 2024 Q1 results
The debt burden of clients of microfinance organisations (MFOs) has been decreasing. According to the 2024 Q1 results, the proportion of loans overdue for more than 90 days went down to the figures of early 2022 and totalled 32%. Such dynamics were in part due to the measures taken by the Bank of Russia to reduce the household debt burden.
However, in January—March, MFOs increased the amount of issued consumer loans by 5.5% compared to 2023 Q4. Notably, more than a half of the borrowers (55%) had already been clients of MFOs or both banks and MFOs in the previous quarter.
Demand was supported by the active digitalisation in the sector. Over the year, the number of MFOs operating online grew by 23%, with 80% of loans issued remotely. Large companies that recently entered the market were focusing on remote service straight away. Concurrently, the amount of loans issued in MFO offices and the number of such offices were gradually decreasing.
Read more in Microfinance Market Trends in 2024 Q1.