Education loan AUM growth for NBFCs is expected to halve this fiscal as disbursements for pursuing educational courses in the US slow down due to policy changes.
NBFCs are diversifying into new geographies and product adjacencies to mitigate the impact of the slowdown in the US education loan market.
Despite stable non-performing assets (NPAs) so far, asset quality of NBFCs will be monitored closely due to global uncertainties and a large proportion of assets under contractual principal moratorium.
The share of education loan disbursements for courses in countries like the UK, Germany, and Ireland has increased, but it will not fully offset the decline in US-linked disbursements.