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Icra Ratings in its latest report has said that securitisation volumes originated by Non-Banking Financial Companies (NBFCs) and Housing Finance Companies (HFCs) have almost doubled to around Rs 33,000 crore in the first quarter of the current financial year (Q1FY23). The growth in volumes reflects a 1.9 times increase when compared to Rs 17,200 crore of securitised assets in Q1 FY22 and a 4.4 times increase compared to Rs 7,500 crore in Q1 FY2021.

It stated the volume of such transactions is expected to cross Rs 1.5 lakh crore in FY23. It mentioned Securitisation of mortgage-backed loans dominated with around 46 per cent share in total securitisation volumes followed by vehicle loan segment accounting for approximately 26 per cent and microfinance at about 11 per cent.

It added the number of originators who securitised their assets in Q1 FY23 increased sharply to 70 from 46 in Q1 FY22. Securitisation is the financial practice of pooling various types of contractual debt such as residential mortgages, commercial mortgages, auto loans or credit card debt obligations (or other non-debt assets which generate receivables) and selling their related cash flows to third party investors as securities, which may be described as bonds, pass-through securities, or Collateralised Debt Obligations (CDOs).