Microfinance Loans Hit ₹62K: Can You Repay?

India's microfinance sector is stabilising after a rough patch. The average new loan has risen to ₹62,000, overdue loans are falling nationally, but some states like West Bengal are still struggling. Here's what this means if you or someone you know borrows from MFIs.

Here's what happened: India's microfinance loan book held steady at ₹3.33 lakh crore in June, signalling sector stabilisation after months of asset quality stress.. The average new microfinance loan disbursed rose to ₹62,000, reflecting larger ticket sizes being offered to borrowers — a trend regulators are watching closely.. Overdue loans declined nationally, but West Bengal bucked the trend with both a shrinking loan book and rising delinquencies, pointing to localised credit stress..

What you should do: Calculate your total EMI-to-income ratio across all MFI and bank loans — if it exceeds 50% of household income, avoid taking any new loan immediately.. Check whether your MFI lender is RBI-registered on the RBI website before signing any loan agreement — unregistered lenders have no obligation to follow fair pricing rules.. If you are in a high-stress state like West Bengal, review your repayment schedule now and contact your lender proactively if you foresee a missed instalment — early communication prevents penalty spirals..

RBI mandates that MFI lenders must disclose the all-inclusive annual percentage rate on your loan document — if your lender shows only a flat monthly rate, ask for the APR in writing before signing.

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