Moneyboxx Finance Ltd (BSE: 538446) Q3 2025 Earnings Call dated Feb. 11, 2025
Corporate Participants:
Mayur Modi — Co-founder, Co-CEO and COO
Deepak Aggarwal — Co-Founder, Co-CEO and CFO
Analysts:
Mamta Nehra — Analyst
Unidentified Participant
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q3 FY ’25 Earnings Conference Call of MoneyBox Finance Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star the zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms Mamtan Hera from Orient Capital. Thank you, and over to you, ma’am.
Mamta Nehra — Analyst
Thank you. Good afternoon, ladies and gentlemen. I welcome you to the Q3 FY ’25 earnings con-call of Finance Limited. To discuss this quarter’s business performance we have from the management, Mr Mayur Modi, Co-Founder; Mr Deepak Agarwal, Co-Founder; Mr Viral Sheth, Finance Controller. Before we proceed with this call, I would like to mention that some of the statements made in today’s call may be forward-looking in nature and may involve risks and uncertainties. For more details, kindly refer to the investor presentation and other filings that can be found on the company’s website and stock exchanges. Without further ado, I would like to hand over the call to the management for their opening comments and then we will open the floor for Q&A. Thank you, and over to you, sir.
Mayur Modi — Co-founder, Co-CEO and COO
Thank you. Thank you so much,, and good afternoon, everyone. I’m Mayur Modi, and I’m pleased to welcome you all to the quarter three financial year ’25 earnings call of MoneyBox Finance Limited. Our financial results and the investor presentations have been uploaded on the company’s website and exchange, and I hope you had a chance to review them.
Joining me today are Deepak Agar was the Co-Founder and Mr Viral, Finance Controller. And before we actually dive all into the business updates, let me start with some macro updates. As we all know that the Indian economy continues to expand, but at a slightly moderated pace. The Reserve Bank of India forecasted India’s GDP to grew at 6.7% in financial year ’26 with quarterly estimates ranging between 6.5% to 7%. While this suggests some softness in domestic demand, which could affect the economic momentum in the near-term. However, the agricultural activity remains very strong, supported by the healthy reservoir levels and the promising rally prospects.
Moving on to the inflation trends, the headline inflation eased to 5.2% in December ’24, coming down from a peak of 6.2% in October ’24. This decline was primarily driven by lower food inflation, particularly in vegetables, which helped bring overall price pressures under control. And this led for the first time in five years, the Reserve Bank of India had to cut the report rate by 25 basis-points, bringing it down to 6.25% aimed at supporting the growth. The RBI governor has assured that India’s structural growth drivers remains very robust, providing a very stable foundation for the long-term economic expansion.
Now shifting the focus to the NBFC sector, a stress-test was recently conducted on the industry, indicates a level of resilience with capital buffers remaining well-above the regulatory requirements, even under very adverse scenarios. However, we must remain mindful of the global medium-term risks, including the geopolitical tensions, global trade barriers, the climate disruptions, the weakening urban demand and the weak export performance, all of which would have a potential spillover effects on the financial system. While some uncertainty surrounds the NBFC sector, we are proactively responding by taking strategic steps.
As a company, we are expanding our branch network, improving the operational efficiencies and enhancing our collection mechanisms. These efforts, we believe will lead us — help us to adapt to changes and continue to grow. Now let’s move on the main item, which is our quarter three financial year ’25 performance. I am pleased to share that our assets under management recorded a 56% year-on-year growth, reaching INR837 crores in-quarter three financial year ’25, including our managed book of INR246 crores. This steady growth has been driven by strategic expansion of our branch network.
In terms of quarterly disbursements, we achieved INR168 crores for the quarter, representing a 8.3% year-on-year increase from INR155 crores disbursed in-quarter three financial year ’24. And the cumulative disbursements since start of the company in-quarter three financial year ’25 reached INR1601 crores.
Moving on to our secured portfolio, we witnessed strong momentum in this segment. Currently, our incremental secured disbursement book constitutes 50% in-quarter three financial year ’25, up from 24% in-quarter — quarter three last year and is expected to reach 60% by the end of financial year ’25. Our secured loan book now makes up approximately 38% of the AUM as of quarter three financial year ’25, rising from 17% in-quarter three last year. And we remain on-track to achieve our 40% target by March ’25. In fact, we will definitely exceed this target. This shift reflects our deliberate strategy to strengthen our asset quality, enhance the risk management and build a more resilient secured loan book.
As of December 2024, we have significantly expanded our operations, growing from 86 branches in eight states in December last year to 160 branches across 12 states. A key milestone in our growth strategy has been our entry into new markets, including our APT, which is Pradesh and Telangana, Sarnataka and Tamil Nadu. We are also pleased to share that we have received continuous support from our lending partners. During this quarter, we successfully onboarded three new lending partners. They are Indian Overseas Bank, Bajaj Finance Limited and Nabkisan Finance Limited. And in January of this year, Small Finance Bank was onboarded, bringing our total number of lending partners to 33 and banks to 12.
Now moving on to income. Our total income grew to 54.6% to INR51.8 crores in-quarter three, up from INR33.52 crores in-quarter three last year, reflecting the steady expansion of our business and our — and our operating expenses as a percentage of AUM remained stable at 12.6% for the nine months ended financial year ’25 compared to 12.7% as of financial year ’24. We remain committed to optimizing costs while ensuring the sustainable growth. Managing expenses efficiently is a key strategic priority of the management and we continue to take steps to streamline the operations. Reducing operating expenses remains a key long-term objective and we are on-track to achieve our target of bringing the OpEx down to 10% by financial year ’26. In terms of yields and spreads, the company’s current yield stands at approximately 27.9% for this quarter, while spreads were at 14.96%.
Moving on to our profitability metrics, our profit-after-tax PAT for the quarter three stood at INR0.0.2 crores and for the nine months ended financial year ’25 was at INR6.5 crores. Our nine-month financial year ’25 return on average AUM came in at 1.2%, while our return on average equity stood at 4%. As you may recall from our earlier discussions, we had highlighted that our ongoing branch expansion will lead to increase in opex, which has had a short-term impact on both our ROE and ROE.
Now talking about our net interest margins, they have remained stable at around 16.6% for this quarter. Our focus remains on improving the asset yields and maintaining disciplined cost management to further enhance our margins. During the quarter, our overall collection efficiencies, this is current and up to 30 DPG, improved to 97.3% in December ’24, up from 96.5% in September ’24. While the collection efficiencies in the current and up to 90 DPD rose to 95.2% in December ’24 compared to 94.5% in September ’24, reflecting a very steady progress. However, our credit cost as a percentage of average AUM increased to 4.7%, largely influenced by the industry-wide stress that we are seeing in the unsecured segment.
That said, we remain very committed to proactive risk management and are very confident that our ongoing collection efforts will help bring the credit cost-down in the upcoming quarters. But to enhance our collection efficiencies, we have taken a number of steps. We have significantly intensified our recovery efforts across all DPD buckets. Company’s collection strategy of building out a separate collection function now with over 100 team members, focusing on the collection along with engagement of calling agencies, digital interventions. We have deployed SMS, IVR and Bot and have intensified efforts on Regal recourse for the recovery of dues is actually showing positive results.
As a result of all these focused initiatives, we have observed a turnaround in collection efficiency from November 2024 onwards and a steady month-on-month improvement is there in collection efficiency. Our on-book cross NPA, which is Stage 3 assets rose to 5.6% in-quarter three financial year ’25, up from 2.78% in-quarter two financial year ’25. Likewise, our NPA increased from 1.41% in-quarter two financial year ’25 to 2.88% in-quarter three financial year ’25. This decline in asset quality is in-line with the broader industry-wide stress that we are witnessing in the unsecured loan segment.
Our provision coverage ratio stood consistent at 50%, reflecting our prudent approach to risk management as we continue to build adequate buffers to safeguard any future — potential future contingencies. Further, the company strengthened its capital position by announcing an equity raise of INR175.8 crores, out of which INR91.08 crores was received in September ’24 and the balance INR84.72 crores is receivable by March 2026, which will provide adequate cushions having further down trend. With this fundraise, net-worth increased from INR169 crores as of March 2024 to INR265 crores as of December 2024. And the expected capital infusion of INR84.72 crores on warrants conversion will increase the capital base to over INR350 crores.
Capital adequacy remains healthy at 35.76% and the debt-to-equity ratio remains low at 1.78 times as of December 31, 2024. Moreover, the increasing focus on secured lending, 50% of disbursements in-quarter three and 38% of AUM as of December ’24 and the improving geographic diversifications with presence in 12 states spread across India is expected to yield stability in asset quality going-forward.
Looking ahead, as we anticipate further improvements in the coming quarters, driven by an expected uptick in rural demand, as economic activity and cash flows in rural and semi-urban area continue to improve, we expect to see a positive impact on repayment behavior amongst our customers. Additionally, we are continuously refining our rate assessment and risk management frameworks to maintain a sustainable asset quality and ensure long-term portfolio health.
Thank you so much. I think now we can move on to ending..
Questions and Answers:
Operator
Sure. Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask questions may press star and one on the touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles to ask questions please press star and 1. The first question is from Nishant Vora from Vora Growth Capital. Please go-ahead.
Unidentified Participant
Hi, good afternoon, sir. Sir, my first question was that I was concerned on the resignation of the internal auditor real-estate. So could you please provide some clarification there on the reason?
Deepak Aggarwal
Yeah. Yeah. Yeah. Good afternoon, Mr So — so basically, as we clarified also on the BFC, so it’s not Viral has resigned from the organization. He remains finance controller of the company, it is just that there was too much on his table and we had a new hire internal audit function. So Saurab will take care from here. So it is just that he was preoccupied with many other things. That’s the only reason.
Mayur Modi
It’s just redistribution of work. I think it’s just that we hired a specific person for the internal auditor and the interim I think Viral was helping us with this function and when we hired Saurav, this function moved to him in terms of responsibilities?
Unidentified Participant
Got it, sir. Thank you. And sir, I wanted to ask that, how are we intensifying our collection efforts? Like how do you — how are you planning to prevent the 30 to 90 bucket from slipping? And how do we get the confidence that you will be able to manage the situation in the future. I mean, the growth that we are doing, 100% or whatever will be sustainable and we’ll be able to collect the money back when required.
Deepak Aggarwal
So is we have already also given in our presentation. So there are multiple steps taken through all the buckets. So you know, as we said in zero to 30, we were not doing other than the LRO collection, the relationship manager collecting, we have introduced a calling, we have introduced SMS bought IVR as additional help in the zero to 30. In 30 to 60 bucket of we have introduced a new line-of-credit officers, which will collect in that level.
Even in the 60 to 90 bucket, will ensure, the collection team is already now 100 plus people. So that impact, you will already see that on the Slide 14, which we have given that actually slide 15, the turnaround has happened in whether in the current bucket, you know it’s a continuous decline and across zero to 30 and up to 90 bucket. So improvement is seen now. And one initiative which we have taken is that to give investors monthly data point. So we started with January and every month, at least till it recovers to the February level, which we used to see, you know, we will be giving monthly updates on the collection.
So we really on-the-ground see that time is changing now in terms of whether client giving the payment in terms of their PTP with crops get better crop season. So situation is definitely improving and we are strongly convinced that max by not later than June, we will have the very similar number as we used to see last one year, one year back. So at least in the zero to 90 bucket, everything will be corrected within next four to five months. Result will be seen month-on-month, but I hope the complete reversal will happen in another four to five months.
Unidentified Participant
Got it, sir. And sir, if you have access to the presentation, then there are — on Slide 15 and Slide 16, there are two different measures of collection efficiency. So could you just help me understand what is the difference there?
Deepak Aggarwal
This is what we are talking about the current bucket, but collection when we talk about collection efficiency, it also includes the portfolio, which has already flowed into the next bucket, say, into the 90 bucket. So for example, when I talk in on the slide 15, you have what is in the current bucket of you know zero to 30 and up to up to 90. But here what we are talking is on the slide 16, what we are talking is collection efficiency, which includes the clientele, which is 90 plus also. So for example, when you already have a higher GNPA, so as we said, there is a 5% of the client, which has crossed 90 bucket. Now there, when that percentage becomes higher, like the overall collection efficiency gets impacted, which is represented by Slide 16.
Unidentified Participant
Got it. Got it.
Deepak Aggarwal
I hope I’m — so what the strategy is, the immediate control, see the biggest problem which happens. When you see the result, you will see that our gross — our operating profit has doubled versus last year, but the profit hasn’t. So the gap is this NPA. So if a client does not pay his three MIs, he flows to NPA bucket. So for example, if for the last quarter, if I have people holding INR18 crore of loans who become — who move to 90 plus bucket, I have to take a INR9 crores write-off on that as a provision, 50% provision, which is as per RBI guidelines. So now that impacts the profitability very significantly. Those are not written offline, but provision has been made. Now as a strategy, what we are doing, first of all, and the impact has started coming in that we have to completely return back to the older numbers wherein we have to stop the slippages from zero to 30 to 30 to 60 and from 30 to 60 to 60 to 90 and then the further slippage. So first of all, remove the provision levels, which is the — which has been the spoil spot this year that client moving into NPA bucket. So that we want to stop wherein I’m saying that June target, but every month we want to get it impacted very, very significantly here and then collect the balance number, which is there. Obviously, for that also there is a strategy and the work is going on. But yes, this NPA movement needs to stop. Of which a lot of steps have been taken.
Unidentified Participant
Okay. Got it, sir. And sir, that would act as a remedy, but like right now, roughly one in 10 customers of ours is not paying back. So are there any changes in the underwriting process that we have and how will it impact the growth further?
Deepak Aggarwal
So not like one in a 10. So you can say that okay, eight out of 100 is getting delayed, slipping over to next bucket from the current bucket. So definitely, but as you see in Slide 15, that slippage is getting sold. You know in April ’24, it used to be 0.37. It peaked in July at 1.77, now it’s coming down. So I’m saying that these are only the steps which are reflecting that we are stocking it here, right? And you will see that number changes even at a better level. And we have a very, very strong recovery mechanism in the next buckets in 30 to 60 and 60 to 90. So that — that slippages we will take it back to a very normal level.
Unidentified Participant
Got it, sir. And sir, my last question was that currently, if I look at our collection efficiency for secured loans and it is — it is still worse than like Q1 when this stress started. So like why are the numbers on secured getting a little worse for us and like is secured in this case really secured, like what happens in case of slippages and secured and what are the actions that we take?
Deepak Aggarwal
No secured is definitely secured. So it is as secured as you see in the competition. It is just that little bit impact of your clientele getting impacted, you know for a period of time because of which has been earlier also said that election seat with states and these clientele got more impacted than others. We had this portfolio, which is a livestock portfolio and the main income, maybe the 70%, 80% of income was from the milk, but you know there was this every — as we always maintained that all our kettle customer have a secondary income, which in a large part is agri income as well. So that also got impacted.
And there, that’s where you see from because of the that slippage is little bit more versus maybe a similar comparable because that agri profile was there in our customer-base, but that does not mean the profile of customer is similar to MFI. There was that agri income. So I mean when an MFI will do maybe two to three cattle where we have like five to six cattle and above, but then income got impacted and so does the — the blips which you see. But you know that secured is secured and people will pay-up. And you will start seeing this because on-the-ground, we have started feeling that level that people now versus November and December, now they are saying that some of them have started paying and some of them are saying that because of the crop season, they will pay-up and they will clear their dues. So I really hope that things will balance out soon.
Over and above, we are also, you know, making it a more diversified portfolio, like in South, our cattle portfolio will be like only 20%. So overall, on a company-level, you will see that shift of portfolio slightly towards non-cattle and largely towards a larger customer because see earlier our ticket size, which see in the average ticket size as well, which is even in secured it is around 3 lakh 3.25 lakh. But now we are doing more-and-more deals which are like 5 lakhs, INR6 lakh, in some cases even going up to 10 lakhs. So even though the profile of customer is changing, which will have a good impact over a period of time.
Unidentified Participant
Got it, sir. Thank you, sir. I’ll get back.
Deepak Aggarwal
To answer your question specifically, that secured thing, you will see the movement. The impact is because of the portion of portfolio, the portfolio mix, but this will — this will soon get corrected. Thank you.
Unidentified Participant
All right, sir. Thank you.
Operator
Thank you. Next question is from Saloni Shah from SKS Investment. Please go-ahead.
Unidentified Participant
Thank you, sir, for the opportunity. Sir, my question is, the share of secured lending in MoneyBoxes portfolio has increased to 38% of the AUM with a target of reaching approximately to 55% by March ’25. So what are the factors driving this strategy shift towards the secured lending? And how do you anticipate it impacting the overall profitability and management?
Deepak Aggarwal
The first question was you’re saying that what are the drivers for secured lending? I think the biggest driver is the management call that we want to make — become a secure lender largely. So you know so historically also we have committed the same number, same thing that we started more as an unsecured lender, but the basic concept was there that we will fund only people having a self-occupied residential property, right, and they are natives of that place. So since big inception, there was this policy that as our cost of borrowing comes down, we started with 20% in first year and now we borrow at 12%. 12% and as the tenure increases, we will build book, which is more secured. So there are multiple factors.
Although a yield is a bit lower, but then once you see in terms of opex, when you have a five to six to seven years kind of funding, your opex comes down very significantly. So what you will see the impact that as we build-on the secured book, because the maturity period is longer, the opex incurred is lower there. Okay. So that’s one.
And on the — on the delinquency front, it will definitely be lower. You know, at in any cycle, if unsecured is 3%, secured will be like 1.5%. I think you can safely assume it will be like half of credit cost versus an unsecured loan, then your borrowing cost also decreases. People are the — as in banks are more — as you grow in larger size, it’s easier to get borrowing from banks, et-cetera when you are more of a secure lender. So definitely, these are the drivers. And yes, initially there is some pain every time when you make a conversion and shift from say unsecured to secured, you have to take some tough calls, you have to let go some of the book which could have been billed in unsecured, but that’s the way you do it. So today, out of 12, six states only do secured business in our case. And slowly — and majority of branches are only doing secured business. So that’s the strategy-wise which is driving.
And in terms of you know your query with respect to profitability, you know, leave aside the short-term blip, but on the long-haul, as you know, when your opex decreases, see, once you see our P&L, what are the — what are the main factors. One is the opex you have to reduce, the borrowing cost you have to reduce. Credit cost is a new dragon here, which we have seen, but you can bring the opex down with secured lending, you can bring the cost of borrowing down with secured lending and obviously credit cost also gets impacted. So profitability over a — over a long-term is good. So I would not say it is bad in unsecured, but when you’re growing and you grow large secured lending definitely helps.
Unidentified Participant
Okay. Okay, sir. And my second question is, sir, the recent — am I audible? Yes. Sir, my second question is, given the recent stress in the unsecured loan segment, what changes have been made to the underwriting process to mitigate the risk and what is expected trend for the credit cost in the coming quarters? And when do we anticipate a return to the normalized debt?
Deepak Aggarwal
In terms of — see what is happening is one is that there are multiple — multiple things which are happening. One is you will notice that there is a very fast movement towards secured. So say we were like 17% last — say 17% last year, December. Now we are 38%. We were 24% year-end in terms of secured now. Now we are saying that 44% 45%. Next year, we should cross 65% in secured, maybe even more. And so one is that you see the trajectory. One is when we said unsecured, the shift towards secured.
The second is even in terms of clientele, you know-how we are communicating with the team that we have to shift — make a shift towards more of a micro where we were saying that you know, even the context from rural to rural and semi-urban and from just micro to small. So you know the kind of clientele we have started entering people with — people owning Treta are now, you know, if I talk about January, we saw people owning Treta becoming our client. So that — that shift is coming because in some cases, we are doing 12 lakh and INR15 lakh as well. So the — so that clientele is changing.
Your last query in terms of normalization, I really strongly believe that by June, you know, we will resolve you know forward moment towards 90, which — so we will be back to our normal thing, you know month-on with month-on-month improvement the way we used to be in February and March last year. Year in terms of before 90 portfolio. And what has moved, we will take very, very significant steps to recover that also. You know that process has already started. It will take some time, maybe it will take one full-year to — because it has already moved but I really hope that with the new changes which we have bought in the in the collection process, things will get better and better.
Unidentified Participant
All right, sir. Thank you so much for answering my questions. That’s it from my side.
Operator
Thank you. Next question is from Devang Mehta from SKB Capital. Please go-ahead.
Unidentified Participant
Thank you for the opportunity, sir. Sir, I have a couple of questions. So my first question is like MoneyBox has rapidly expanded its branch network from 100 to 160 within the past nine months, right? So can you elaborate on the strategy behind this aggressive expansion and is anticipated impact on the business growth?
Mayur Modi
And so basically the strategy is in-line with what the way we started that we will expand at least 60 branches, maybe three or four more will come in this financial year. But what has happened here is that we are now a pan-India franchise. So with four — adding four South states. So now we have presence across India, largely you can say. So that was the one — that was one part.
Second is only also because we have given our targets in terms of growth rate. This year has been exception because you know-how the market is doing, you know. So maybe for this year, I’m saying that anywhere between 25% to 25% to 35% growth rate this year. But — but it has made us ready for the time when markets picks up. So that’s the key thing.
That’s the way it will help because we have a pan-India presence diversification between number of branches, number of states, diversification between product portfolio because it is different in South versus in north. So across-the-board, we are diversifying. Yeah. And it will definitely help in the expansion in terms of AUM.
Unidentified Participant
Okay. So sir, do you like face any challenges in scaling the operation in the new regions like mostly outside the India?
Mayur Modi
No outside India. Yeah. No, no, outside India, we don’t have a strategy. See, for these kind of loans, you really have to dig really deep whether you want to go or because Indian market at present is so large that you will not like to consider extension abroad. I mean nearby countries, it’s not that in Indonesia, the market is very big. It’s not the case. I think at our stage, definitely, our opportunity is far larger in India.
I think what we have to focus is that we should reach a single-digit opex level, single-digit borrowing cost level and improve our ratings, improve our size. So that’s — that’s the strategy. So international, definitely we are not changing at this point of time.
Unidentified Participant
Okay. Okay, sir. Got it. And sir, last question is like how do you plan to optimize the branch productivity considering the AUM per branch for vintage branches is INR13.8 crore.
Mayur Modi
So that that’s what the work will do especially in coming years. This year has been bad otherwise definitely it would have been better but you know now the focus will increase a lot in terms of making optimum AUL level at each of the brands. So I think now we have a very right team and you know in terms of senior management, you know, we have covered a very large part of the CRO, the compliance head of HR head.
At all levels, we have people who are 20 to 25 years of workX. We have collection head also joining this month. So I think the team is there, the — I mean, the people side is very much there. Now we have products as well. So now we are able to do up to 15 lakhs. So that’s the reason I believe that we will be really able to optimize now the branch productivity.
Unidentified Participant
Okay, sir. Got it. Thanks. Thanks for the opportunity. Thank you.
Operator
Thank you. Next question is from Sahil Vora from MNS Associates. Please go-ahead.
Unidentified Participant
Hi, good afternoon, sir. I just had a few questions. Just a second. Yeah. My first question is the collection efficiency has shown a notable improvement since November 2024. Could you elaborate on the key factors driving this recovery? And what specific measures are in-place to maintain or further enhance collection efficiency in the coming quarter?
Deepak Aggarwal
So, we started as we have spoken even in our last presentation that till 31st of August, we had zero collection, anything which is special — specifically focused on collection. So from September onwards, we started people who were not doing good in sales you know we brought them to collection to you know about 47 people now month-on month you know we have, like you know, currently we have 60 people in the on-field collection and which are also held by about 35 vet doctors who are also helping us in cattle rapid cases.
So almost a team of 100 people and every month, we are getting new people. I mean, we are you introducing new people who are like very collection oriented. So that’s on-ground team. Then we never had. So across now all buckets, starting from February. So starting from January, we had 30-plus bucket coverage. Starting from February 1st week, all buckets are covered through SMS, IVR and telecoln as additional support. And then now we are also making dedicated effort in terms of central team helping the brand staff in collection, you know with specific allocation to each of each bucket to each specific team.
So I think those — those things have started happening from mid of last month and that’s why I really believe that results will really improve from here. But you know some has happened of the last three months effort and now we really have the team across all buckets. So things will get better and better. So every month we are enhancing the collection efforts.
Unidentified Participant
Okay. Got it. Sir, furthermore, with legal actions being initiated for delinquent accounts, could you provide an update on their effectiveness? Have these measures resulted in a meaningful reduction in overdue accounts? And how do you assess their overall impact on the asset quality and future provisioning requirement?
Deepak Aggarwal
And secondly, on the legal action, it is — it is not I would say too early. One is with notices, with just notices, there is impact on collection, which happens. With respect to going legal, see, last year we only filed 10 cases which was in H1. And in those — actually nine cases, in those nine cases, in four cases, there is arrest warrant, which is already there. This quarter we are doing about 170 filings in terms of legal. So that’s that will take some time you know. But I think that gives an indication to people that you know company is no longer, you know it’s not silent about delicacies.
Delicacies earlier because the flow was so less that we thought you know you know it, we can go easy with it but I think as the credit cycle has shown us that we had to have a very particularly strong strategy for each bucket, which is a good part which has happened out of this credit cycle that now we have a particular strategy on how to collect from each bucket and it is improving month-on-month. I’m not saying we have done 100% of it. Maybe we have reached 50% of it. But in next three, four months, everything which we have planned will be on-track.
Unidentified Participant
That’s good to know. Thank you, sir. That’s it from my end. All the very best.
Operator
Thank you. Next question is from Yash Mathre from Cruise Capital. Please go-ahead.
Unidentified Participant
Hi, sir. My first question would be, there is a noticeable increase in both the gross NPA and net NPA levels in the recent quarter. So could you just help us out with the detailed analysis on the key factors and of why this has continuously?
Deepak Aggarwal
So the key is the flow. You know, it’s simple that you know the clientele, which moved to 90 plus bucket got increased. So last quarter, we had INR18 crores worth of clientele, which moves to 90 plus bucket and that’s why the INR9 crore of INR9.14 crore of provisioning, which has happened in this quarter. So as I said that, you know if you see the charts, we just gave the chart, that’s why that earlier in the X bucket, you know, we had — so if there are like 200 clients, only one client will slip. So it was that good that out of 200, even not even one client will slip to next bucket, which in July reached to 1.77. So more than 3.5 client moving.
Now that has come down to one, right? So we are saying that out of 200 from 1 to 2, it’s still double that last year number. You know what used to happen in February and March. So now what — so now the strategy that way is that we stop the slippage at first level and then be very, very aggressive in collecting into 30 to 60 and 60% 90 bucket. Last month, we saw a 30% dip in terms of number of clients moving to 90 plus. So I mean last one is this month, which would have moved into 90 plus in February. So what the initiative we took for half of month-in January gave us very significant results for the slippages in. So I think those things will improve.
As I said that I’ve explained that the bureau, which is also given on Slide 15 that the collection efficiency dumped in this bucket and because in the last six years, this was the first time, say, after 5.5 years, this is the first time we have not seen this even during COVID. So that dip we saw for the first time, but I think corrective actions are in-place, so things will improve. And even generally market is improving. I’m saying one is the collection part, but even generally the market is showing signs of improvement now.
Unidentified Participant
Okay, sir. Thank you. These are there.
Deepak Aggarwal
The important part is that we are not a digital lender, that we cannot reach these clients or we can reach them only through digital modes. There are branches. These clients are there. I mean, it’s not that they have expanded. We have funded the guys who were natives of that place. They are there, they are reachable, not even like 2% of the people are like even or not even 1% or not even 0.5% where we can say that clients don’t exist now. They are all there at their home.
There are some problems, someone has a medical problem, someone has some other problem. But I think they are not really saying that they will not pay. They might not have in some cases they might not have money to pay right away, but it’s not that they are not accepting that they have to pay. So I think once the rigorous follow-up is there, they will pay.
Unidentified Participant
Okay, sure. Thank you, sir. Thank you.
Operator
Thank you very much. We’ll take that as the last question. I would now like to hand the conference over to Ms for closing comments. MS..
Mamta Nehra
Hello. Thank you. I would like to thank the management for taking this time-out for the conference call today and thanks to all the participants. If you have any queries, please feel free-to contact us. We are Orient Capital Investor Relation Adviser to MoneyBook Finance Limited. Thank you so much.
Operator
Thank you very much. On behalf of MoneyBox Finance Limited, that concludes this conference. Thank you for joining us. Ladies and gentlemen, you may now disconnect your lines