With loan repayment at 80-85%, ESAF Small Finance Bank expects few defaults as moratorium ends

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MD and CEO K Paul Thomas said the call on the IPO will be taken after September following a review of the business and macro-environmentESAF Small Finance Bank is expecting very few defaults as it said loan repayments were at 80-85% in the first week of September, after the moratorium period ended on August 31. The Kerala-based small finance lender has more than 96% of its exposure to the micro segment, where the average ticket size of the loan is Rs 33,000.“Almost 100% of the loan customers availed the benefit of moratorium in the first two months (April and May) and it decreased to 80% in June-July, and by August it was down to 60%. Except for the city-based small trading businesses, we don’t see much problems in repayment. We don’t have much exposure in the corporate sector as our focus is mostly in the retail sector,” K Paul Thomas, managing director and CEO of ESAF said.Related NewsThomas added that business was back to normal in the rural areas with the rural customers in farming and animal husbandry showing more resilience. The rebound has been slower in the urban areas with some sectors like tourism, restaurants and small traders affected the most.“ …

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