Midland Micro Finance Limited Unlisted Shares

Annual Report Summary

Driving growth sustainably, Midland Microfin Limited's Annual Report 2023-24 highlights the company's commitment to empowering women, improving lives, and ensuring inclusive development. It provides an overview of the company's journey, geographical footprint, financial performance, operational overview, and corporate social responsibility initiatives.

Corporate Overview:

Midland Microfin Limited is committed to the financial and social empowerment of women by offering small business loans. Headquartered in Jalandhar, it is the first RBI-registered Systematically Important Non-Deposit taking Non-Banking Financial Company (NBFC-ND-SI). The company strives to eradicate poverty through financial independence, focusing on grassroot empowerment and technology-driven microfinance. It has expanded its footprint to 12 states and 2 UTs. The company emphasizes making credit simpler for the poor, adopting a technology-driven approach to ensure inclusive development.

Financial Performance:

The company's Assets Under Management (AUM) surged by 38% to 2672 Crores, and total disbursements grew by 30% to 2520 crores. Profit After Tax reached 72 crores, a 54% increase. Operating Profits rose by 193%. The company has 436 branches spanning 12 states and 2 UTs, serving 1,95,226 Joint Liability Groups. The key financial metrics include:

• Authorized Share Capital: INR 1,280.0 Million
• Net Worth: INR 4,878.6 Million
• AUM: INR 26,715.5 Million

Operational Overview:

The business is segregated into loan products and insurance services, expanding product portfolio and geographical reach. The company deploys strategies for careful governance of working capital, including regulatory compliance, robust credit assessment, regular monitoring and collection, diversified funding sources, efficient use of technology, client relationship management, stringent internal controls, and liquidity management. The company also offers various loan products such as business loans, sanitation loans, education loans, dairy loans, and water purifier loans.

Corporate Social Responsibility (CSR):

The company’s CSR policies align with empowering underprivileged sections of society, especially women. Initiatives include financial literacy, education, female hygiene, crisis management and environmental sustainability. In FY24, 14,750 people benefitted from CSR. The expenditure on CSR initiatives constituted 2% of revenue.

Risk Management:

Midland Microfin has a robust risk management framework overseen by the Board. Key elements include a Risk Management Committee and Asset Liability Management Committee (ALCO). The company identifies credit risk, operational risk, climate risk, enterprise risk management risk, interest rate risk, IT/cybersecurity risk, compliance risk and model risk. Mitigation strategies involve enhanced risk assessment, alliances with NGOs and local bodies, improved customer service, enhanced risk assessment, and diversification of their portfolio.