Chapter 3 - Section 3.4.1On-Balance Sheet Portfolio of MLIs

The On-Balance Sheet/ On Book portfolio represents loans that Micro Lending Institutions (MLIs) have on their own books, funded through their own capital and borrowings, as against the loans originated and assigned or securitised to other lenders, but managed by the original institution. The portfolio originated through Business Correspondent or co-lending arrangements also forms part of managed assets and does not form part of the on-book, except the portion of share owned by the originator under co-lending arrangement.

Read More

3.4.1 On-Balance Sheet Portfolio of MLIs

The On-Balance Sheet/ On Book portfolio represents loans that Micro Lending Institutions (MLIs) have on their own books, funded through their own capital and borrowings, as against the loans originated and assigned or securitised to other lenders, but managed by the original institution. The portfolio originated through Business Correspondent or co-lending arrangements also forms part of managed assets and does not form part of the on-book, except the portion of share owned by the originator under co-lending arrangement.

As of March 31, 2026, the On-Balance Sheet Portfolio stood at ₹1,70,948 Cr., making it the dominant share of the sector’s overall lending activity. It has grown by 3% year-on-year from ₹1,65,268 Cr. in March 2025. In the case of Off-Balance Sheet portfolio arrangements, especially with co-lending, borrowers benefit due to lower rates of interest or getting facilities from financial institutions with a local touch and feel.

Figure 3.5: On-Balance-Sheet Loan Portfolio of MLIs (in ₹ Cr.) –Yearly Trend and Category–wise Breakup as of March 2026

A further segregation of the On-Balance-Sheet Loan Portfolio based on the legal forms of MLIs and the size of MLIs is given below:

Note: In the decadal trend graph of the On-Balance Sheet Portfolio (2016–2026) shown above, the On-Balance Sheet Portfolio for each year is represented by blue bars, covering all Micro Lending Institutions (MLIs). For FY 2025-26, however, the total On-Balance Sheet Portfolio of ₹1,70,948 Cr. has been further disaggregated to provide clearer insights. The breakdown highlights MFIs (NBFC-MFIs, Societies, Sec. 8 Coms, Trusts, MACS, or Cooperatives) shown in red, NBFCs in green, and Pvt. Ltd. Coms in orange, offering a clearer picture of the growth pattern of MFIs.