Bihar Passes Microfinance Regulation Bill, Shares of Lenders Decline Amid Compliance Concerns

Shares of microfinance lenders declined following Bihar's passage of the Micro Finance Institutions Bill, 2026, which imposes stricter regulations including mandatory state registration, prior loan approval, and caps on interest rates and borrower exposure. Fusion Finance and Utkarsh Small Finance Bank saw notable share drops. Analysts warn of potential slower credit growth and higher compliance costs. Separately, ICRA reaffirmed AU Small Finance Bank's long-term rating at 'AA', citing strong asset quality and growth prospects despite recent regulatory challenges.