(MENAFN- KNN India) New Delhi, Nov 25 (KNN) Assets under management (AUM) of non-banking financial companies (NBFCs) are expected to grow at a steady 18–19 percent in the current fiscal and the next, surpassing Rs 50 lakh crore by March 2027, according to a Crisil Ratings report released on Monday.

The agency attributed the momentum to firm consumption demand, supported by recent policy measures such as rationalisation of GST rates and a benign inflation environment, which are expected to sustain retail credit demand across asset classes.

Crisil noted that the growth trajectory will vary across entities and loan categories as risk calibration and funding dynamics continue to play a critical role, reported ANI.

Unsecured Micro, Small and Medium Enterprises (MSME) business loans-accounting for about 6 percent of NBFC AUM-have recorded higher delinquencies due to increased borrower leverage and overlaps with the microfinance customer base.

Consequently, AUM growth in this segment is projected to moderate to 13–14 percent, down from the sharp 31 percent expansion seen in the previous two years.

In the broader unsecured loans category, trends are expected to diverge between personal and business loans.

Personal loans, which constitute roughly 11 percent of NBFC AUM, saw growth slide from 37 percent in FY24 to 18 percent last fiscal as lenders recalibrated target segments in response to regulatory actions.

However, with improvement in the performance of recent originations, personal loan growth is expected to recover to about 22–25 percent over the current and next fiscal years.

The gold loan segment-around 6 percent of overall AUM-is set to remain one of the industry's strongest performers, driven by greater formalisation, a shift from unorganised lenders, elevated gold prices and rising NBFC participation in gold financing.

On the liabilities front, Crisil highlighted that access to bank funding continues to be a key growth determinant, especially for mid-sized NBFCs.

Bank lending to NBFCs stood at Rs 13.8 lakh crore as of September 2025, only marginally higher than a year earlier.

“Despite the rollback in risk weights from April 2025, bank lending to NBFCs is yet to see a meaningful pick-up,” said Ajit Velonie, Senior Director, Crisil Ratings.

He noted that while larger NBFCs have tapped the debt markets and external commercial borrowings, mid-sized players have limited alternatives, making a revival in bank funding crucial for their growth outlook.

(KNN Bureau)

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