Chapter 3A - Section 3a.1Distribution of NBFC-MFIs across region and size

NBFC-MFIs are major players in delivering microfinance services to low-income households. This category of institutions was created by the RBI following the recommendations of the Malegam Committee, with a focus on micro-lending. The RBI has prescribed specific norms for classifying loans as microfinance loans, generally referred to as qualifying assets, and has also specified the minimum proportion of such assets that an institution must maintain to qualify for registration as an NBFC-MFI (presently it is adjusted to 60% of total assets).

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Performance of NBFC-MFIs in Microfinance

NBFC-MFIs are major players in delivering microfinance services to low-income households. This category of institutions was created by the RBI following the recommendations of the Malegam Committee, with a focus on micro-lending. The RBI has prescribed specific norms for classifying loans as microfinance loans, generally referred to as qualifying assets, and has also specified the minimum proportion of such assets that an institution must maintain to qualify for registration as an NBFC-MFI (presently it is adjusted to 60% of total assets).

NBFC-MFIs also share a similar regulatory framework with other NBFCs. In addition, they have specialized parameters to consider as an NBFC-MFI. Under the Scale-Based Regulation (SBR), the Reserve Bank of India introduced a regulatory structure that categorises all NBFCs into four layers based on their size, activity, and perceived riskiness. Out of the total 93 NBFC-MFIs registered with the RBI, 25 fall under the ‘Middle’ layer (non-deposit-taking NBFC with asset size above ₹1,000 Cr), and the rest are under the ‘Base’ layer (NBFC-ND with asset size below ₹1,000 Cr).

RBI has also mandated other guidelines such as appointment of an internal ombudsman, the Prompt Corrective Action (PCA) Framework, and defining the role of Compliance Officers for NBFCs, which also apply to NBFC MFIs. Additionally, the RBI introduced a comprehensive Regulatory Framework for Microloans to govern household income caps and pricing.

3.A.1 Distribution of NBFC-MFIs across region and size

Table 3.A.1: Region-wise distribution of NBFC-MFIs1
Region State/UT No. of NBFC-MFIs
North Delhi (11), Rajasthan (2), Punjab (1) 14
East Bihar (1), Odisha (3), West Bengal (13) 17
West Gujarat (6), Maharashtra (11) 17
South Karnataka (11), Keralam (1), Tamil Nadu (16), Telangana (3) 31
North East Assam (6), Manipur (1) 7
Central Uttar Pradesh (6), Chhattisgarh (1) 7
Total 93
Table 3.A.2 Size-wise distribution of NBFC-MFIs
Size No. of NBFC-MFIs Gross Loan Portfolio (₹ in Cr.) Share out of the total Portfolio
Nano (<₹100 Cr.) 40 1,455 0.89%
Small (₹100 Cr.-₹500 Cr.) 19 4,346 2.64%
Medium (₹500 Cr.-₹2,000 Cr.) 10 12,457 7.58%
Large (₹2,000 Cr. - ₹5,000 Cr.) 7 23,486 14.29%
Very Large (>₹ 5,000 Cr.) 9 1,22,656 74.61%
Total 85 1,64,400

Note: The above table (3.A.2) is based on the self-reported data, whereas the table (3.A.1) is based on the RBI-registered NBFC-MFIs. Out of these 93 NBFC-MFIs registered with RBI, some of them are non-functional or inactive.

1 Based on the RBI data as on June 2026

The NBFC-MFI segment is highly concentrated, with 9 very large institutions accounting for 74.61% or ₹1,22,656 crore of the total portfolio, while 7 large institutions contribute 14.29%. In contrast, 69 nano, small and medium NBFC-MFIs together account for only 11.11%. This indicates that the sector’s portfolio is predominantly concentrated among a relatively small number of very large NBFC-MFIs.