Non-bank finance companies (NBFCs) are likely to maintain growth in assets under management at 18%, despite a cautious approach on lending in certain buckets due to high customer leverage, a rating agency said on Monday.
The overall AUMs for the industry are expected to touch ₹50 lakh crore by FY27-end on the back of a steady 18-19% growth per annum, Crisil Ratings said.
"...exercising due caution on heightened customer leverage, NBFCs will adopt risk-calibrated growth, especially in the micro, medium and small enterprises (MSME) and unsecured loan segments," its chief rating officer Krishnan Sitaraman said.
31 October 2025
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The agency said unsecured MSME business loans, which constitute 6% of industry AUM, have seen an increase in delinquencies amid higher borrower leverage and adjacencies with the microfinance customer segment.
This will result in the AUM growth slowing down to 13-14% from over 31% seen in the last two fiscals, it added.
In the case of personal loans, which constitute 11% of the industry AUM, the growth is expected to improve to 22-25% from 18%, but will still be lower than the 37% seen in FY24, it said.
Recent policy measures, such as rationalisation and reduction of goods and services tax (GST) rates, together with benign inflation, will help sustain retail credit demand across asset classes, it said.
The growth in loan against property (LAP)/secured MSME segment, constituting 15% of NBFC AUM, is expected to normalise to 26-27% in FY26 and FY27, but lenders will be cautious on the low-ticket segment due to an increase in early delinquencies, it said.
The gold loan segment, which is 6% of AUM, should continue to outperform other asset classes, driven by increased formalisation, with a shift from unorganised players, high gold prices, and NBFCs' interest in entering the gold finance market.
The approach taken by banks, the main source of funds for NBFCs on lending to the sector, will influence the growth in the industry's AUMs, its senior director Ajit Velonie said, adding that bank lending to NBFCs is yet to see a pick up.
"While larger NBFCs have accessed other funding avenues, such as the debt capital market and external commercial borrowings, others have fewer alternatives. Hence, the extent of rebound in bank funding will influence the growth outlook for these NBFCs," he added.
