Scoring Bureau: microloan issuance in Russia increased by almost 14 percent
In May 2024, Russian microfinance organizations (MFOs) issued record volumes of loans. This is reported by RBC with reference to the Scoring Bureau and the National Bureau of Credit History (NBKI).
As explained by the chief analyst of the management company Ivolga Capital, Mark Savichenko, the main reason for this is high demand from the population.
Scoring Bureau reported that individual clients received loans worth 81.4 billion rubles. Compared to April, in monetary terms, issuances increased by 9.9 percent, and in quantitative terms by 13.8 percent. In annual terms, the volume of approved loans increased by almost 42 percent. The NBKI calculated that Russians received 3.4 million loans worth 44.6 billion rubles in the last month of spring. In quantitative terms, growth is 4.6 percent, and in monetary terms, 6.7 percent. Annual growth in issuance volume is 16.4 percent.
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Business Development Director of MigCredit MFC Nikita Kotochigov explained the situation by saying that microcredit organizations are trying to “breathe” by gathering more borrowers before regulation is tightened. Starting in July, Russia will change the rules for calculating the debt burden indicator (DLI). Market participants will be required to obtain information about a client’s financial burden from not one, but all qualified credit history bureaus.
Bank MFOs also make their contribution, where they refer borrowers who were not given a loan by the bank itself. The financial director of the Eqvanta group, Yakov Romashkin, spoke about their growing number.
According to Andrey Ponomarev, CEO of the online financial platform Webbankir, the client base of microcredit companies grew by more than 120 thousand people over the spring. The situation is developing especially dynamically in the cities of the Urals – Yekaterinburg, Chelyabinsk, Ufa and Perm.
As Kotochigov noted, the main demand for microloans is formed by regular customers, of whom there are almost 55 percent of the market. However, there are more and more new borrowers. Thus, 8 percent of Russians who received a microloan from an MFO in the first quarter had never turned to such financial sources before.
However, according to NBKI, if in 2023 42 percent of the total number of applications for loans resulted in the issuance of a loan, then in 2024 this figure dropped to 39 percent.
Ivan Uklein, senior director for banking ratings at Expert RA, predicted that in 2024 the issuance of microloans in the Russian Federation will increase by 25 percent in annual terms. So far, the demand for classic microloans remains “sustainably high,” but after July 1, market dynamics will slow down.
In 2023, a record volume of microloans was issued in Russia, which reached a trillion rubles. Compared to 2022, the increase was 30 percent. The year before last, issuance increased by 22 percent.
By the beginning of March 2024, the approval rate for microloan applications for new borrowers was 19 percent, and for repeat borrowers – 84 percent. In 2023, this ratio was 19 and 93 percent, respectively.
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