New Delhi, March 13 -- The collection efficiency trend for unsecured asset classes, such as microfinance loans, personal loans and unsecured SME loans, has seen weakening performance in the last few months, rating agency ICRA said on Thursday.

The weak collections in the unsecured space, as per ICRA, are due to a slowdown in economic activities coupled with the overleveraging of borrowers.

The microfinance pools' collections dropped to 90 percent in Q3 2024-25 from their previous high of 97 percent at the beginning of the financial year.

Collections in the SME segment also weakened in 2024-25, especially in the unsecured asset class, where efficiency ranged between 85-92 percent in the first nine months of 2024-25.

Secured asset class...