The Many Hands behind India’s Growth The industry as a collective force of working people across the sector The microfinance industry represents a powerful collective force working to strengthen the foundation of India’s socio-economic pyramid. Behind its impact are many hands -regulators, industry bodies, investors, institutions, and field teams - working together to extend responsible financial services to underserved communities and create opportunities for sustainable growth. In FY 2026, the Reserve Bank of India, self-regulatory organisations, and industry stakeholders provided critical guidance and support, while investors continued to back the sector’s long-term potential. Together, these efforts have enabled microfinance institutions such as Arohan to remain focused on responsible growth, ensuring that access to finance translates into meaningful progress for customers, communities, and the broader economy. The Indian microfinance sector is currently going through an important phase of transformation. After facing challenges related to higher credit costs and portfolio stress in recent years, the industry is gradually moving towards a more balanced, resilient, and sustainable growth path. This shift reflects not just a recovery but also the growing maturity of the sector. Recent improvements in loan disbursements and portfolio growth indicate a stronger focus across the industry on responsible lending and sound business practices. For our Company, these developments reaffirm the importance of maintaining strong risk management standards, disciplined customer acquisition, and a continued emphasis on portfolio quality. | 30 Annual Report | 2025-2026 Management Discussion & Analysis
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