Category: Banking & Finance

The last four to five months have been a phase of consolidation and transformation, where we realigned our business mix towards highly scalable products, targeting formal credit-tested borrowers with increasing play on salaried and professional individuals. We have a very highly ambitious plan of growing with a focus on generating operating profits and keeping credit costs well within predefined limits. To achieve this, we have identified five core operating levers — brand and equity capital coupled with our cost of funds. We have already achieved a significant repricing of our existing debt and raising fresh debt at very fine rates. The third lever is a very strong senior leadership team; the fourth lever is our distribution and collection infrastructure and the fifth lever will be our digital strategy.

We will look at tech and digital as major enablers for doing business. For each one of the businesses, our ambition will be that we have an end-to-end digital journey for our customers. We will use analytics as a very potent tool for sourcing, credit underwriting and risk monitoring. We will focus on the credit costs, right from the time of onboarding of customers and maintain them within the predefined parameters.

We have rolled out personal loans and loans to professional business. We have started SME loans against property last month.

The small ticket LAP will be rolled out in the next quarter. Co lending and fintech partnerships are on. Pre-owned car finance is also there and we have a very good affordable home loans franchise. These will be our focus segments. We are also at the advanced stages of launching medical equipment loan franchise, small ticket loan against property, and a few co-lending and fintech partnerships.

We have been into pre-owned car finance.

However, tech and digital are at the front of all our value propositions and which not only offers frictionless delivery of financial services but also reduces the cost of acquisition and opex. Fintechs are playing a complementary role in the financial supply chains. In addition to our physical distribution infrastructure, which we already have in place for pre-owned car finance and other products, we are actively looking at harnessing such partnership ecosystems.

We inherited 290 branches. We are looking at branch rationalisation rather than branch increase or branch decrease.

Some branches will be shut where the product focus is not there or those which have not been profitable. We are looking at strengthening our presence in some markets like Tamil Nadu, Maharashtra and Gujarat where our branch penetration was not so adequate.

The overall business outlook seems to be very encouraging if we look at all the high frequency indicators like GST collections, the commercial vehicle sales and the push for online payments. We believe that we are up for a good business cycle in the coming years. The recent few months have also provided a huge amount of market opportunity across the products that we have identified and our business also has been responding quite well to these market opportunities.

Not at all. We took a few prudent measures at the beginning of this financial year where we revised our write-off policies more to actually align with the real credit costs that the product lines bring and also took prudent management provisions to take care of any unforeseen events. We don’t see any sort of negative surprises in the near to long term.

We received very large capital infusion by way of this (Magma) transaction. We are not looking at a capital raise at least for the next three to four years. We are sufficiently capitalised to grow our businesses in the near term.