New Delhi, July 9
For non-banking finance companies (NBFCs) in India, education loans have been the fastest-growing asset class, clocking over 50 per cent growth in the assets under management (AUM) over the past few years, a report said on Wednesday. This fiscal (FY26), growth is seen moderating to 25 per cent with AUM reaching Rs 80,000 crore.
The pace is likely to halve this fiscal as disbursements for pursuing educational courses in the US decelerate following a raft of policy changes in that country, according to the report by Crisil Rating.
To mitigate the impact, NBFCs are diversifying into new geographies and product adjacencies. While non-performing assets (NPAs) have remained stable so far, asset quality will be monitorable given the global uncertainties and a large proportion of AUM (85) remaining under contractual principal moratorium, the report mentioned.
The education loan AUM of NBFCs grew a rapid 48 per cent to Rs 64,000 crore last fiscal. That followed an even faster 77 per cent growth in fiscal 2024.
“Policy uncertainties in the US, combined with measures including reduced visa appointments and the proposed elimination of Optional Practical Training norms have culled newer loan originations. This has led to a 30 per cent decline in total disbursements to that geography last fiscal,” said Malvika Bhotika, Director, Crisil Ratings.