Tag: expansion

IOB stays on strong profit curve

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Public sector lender Indian Overseas Bank (IOB), which came out of RBI’s PCA framework last month, continues to maintain its profitable growth curve and is working out mid-term plans for branch-cum-manpower expansion

“Since the bank is now allowed to resume its expansion activities, IOB is likely to hire 100 officers and 70 clerks. We are redrawing our manpower policy based on the digitalisation policy. The bank may open 30-40 new branches next fiscal even as we would continue with branch rationalisation exercise. We will come out with our mid-term plan soon,” said Partha Pratim Sengupta, MD & CEO of the bank.

Doubled net profit

Meanwhile, the bank more than doubled its net profit to ₹376 crore for the quarter ended September 30 against ₹148 crore in the same period a year ago, helped by lower provisions.

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The bank’s operating profit grew 5 per cent to ₹1,419 crore against ₹1,346 crore on account of reduction in interest expenditure and higher non-interest income.

Falling interest income

Total income stood at ₹5,376 crore against to ₹5,431 crore. Interest income fell to ₹4,254 crore from ₹4,363 crore while non-interest income was higher at ₹1,121 crore (₹1,068 crore). Net interest margin was lower at 2.43 per cent (2.57 per cent).

“The industry has become more competitive. Almost all bigger banks have reduced their interest rates. So, in this competitive scenario, we need to match the same level. However, our strategy will now be to boost other income to make up for the above,” said Sengupta.

Lower provisions

Total provisions were lower at ₹1,036 crore (₹1,193 crore). Slippages were at about ₹1,400 crore, of which three accounts — including an NBFC — contributed 60–70 per cent.

Also see: Cash is still ‘King’ as digital divide between Bharat and India continues

“These three accounts were known to us and booked as NPA two quarters ago. But, because of the stay in the Court none of the banks could do it. The stay was vacated during the September quarter and we have booked it as NPA. It will not impact the balance sheet as we started doing the provisions right from the day, we identified the stress. As on date, we have provided almost 80 per cent for that account,” he added.

Lower NPA ratios

Gross NPA ratio fell to 10.66 per cent from 13.04 per cent in the same quarter a year ago and 11.48 in the preceding quarter. Net NPA ratio stood at 2.77 per cent, down from 4.30 per cent in Q2FY21 and 3.15 per cent in Q1FY22. Its provision coverage ratio improved to 92 per cent from 91.56 per cent in the preceding quarter.

Deposits increased to ₹250,890 crore in Q2FY22 against ₹242,941 crore in the year-ago quarter while gross advances stood at ₹1,46,940 crore (₹1,35,469 crore).

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ICICI Bank to offer instant OD to sellers registered on amazon.in

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ICICI Bank on Monday announced that it has partnered with Amazon India to offer overdraft (OD) facility upto ₹25 lakh to individual sellers and small businesses registered on the e-commerce marketplace amazon.in.

“Driven by API integration, the partnership enables sellers to avail an OD from the Bank in a process — from application to sanction to disbursement — that is entirely digital. Even customers of other banks can avail the OD facility from ICICI Bank, if they are registered as sellers with amazon.in,” it said in a statement.

ICICI Bank launches digital banking solutions for corporates

Leveraging advanced data analytics, ICICI Bank has developed this new facility that functions on the back of a scorecard to instantly evaluate credit worthiness of sellers based on their financial profile, including Credit Bureau scores, it further said.

New expansion avenues

“This new and improved process will help the sellers, who may otherwise not get access to adequate credit when assessed in the traditional way of using only balance sheets, bank statements and tax returns. We believe that this new proposition resonates with our effort in developing path-breaking innovations for MSME customers and will empower them with new avenues of business expansion,” said Pankaj Gadgil, Head-Self-Employed Segment, SME & Merchant Ecosystem, ICICI Bank.

‘Amazon expects 85% new customers from tier-2 cities’

Vikas Bansal, Director-Amazon Pay India, said, “Our mission is to enable easy and trusted access to credit for sellers with transparent policies and at low costs. Our partnership with ICICI Bank will provide sellers across India with an OD facility instantly and digitally at affordable rates to meet all their current and future requirements.”

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HDFC to double its rural reach to 2 lakh villages in the next 18-24 months

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Private sector lender HDFC Bank plans to expand its reach to 2 lakh villages over the next 18 to 24 months.

“The bank plans this expansion through a combination of branch network, business correspondents, business facilitators, CSC partners, virtual relationship management and digital outreach platforms,” it said in a statement on Sunday, adding this would increase its rural outreach to about a third of the country’s villages.

HDFC Bank currently offers its products and services to MSMEs in over 550 districts and its rural banking services extend to 1,00,000 villages. It aims to double this to 2,00,000 villages. As a part of this plan, it plans to hire 2,500 more people in the next six months.

“India’s rural and semi-urban markets are under-served in credit extension. They present sustainable long-term growth opportunities for the Indian banking system. Going forward we dream of making ourselves accessible in every pin code,” said Rahul Shukla, Group Head – Commercial and Rural Banking, HDFC Bank.

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HomeLane raises ₹370 crore for expansion, branding

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HomeLane, an online home interior company, has raised $50 million (₹371 crore) in its Series-E funding round on Thursday, led by IIFL AMC’s Late Stage Tech Fund, OIJIF II (Oman India Joint Investment Fund) and Stride Ventures.

Existing investors Pidilite, Evolvence, NuVentures, Sequoia and Accel also participated in this round of fundraising. With the current round, HomeLane has raised over $104 million (about ₹765 crore) in the last seven years.

Srikanth Iyer, Co-Founder, HomeLane said the fresh fund will be used in brand building as the company ventures into new markets in smaller cities and strengthen technology capabilities to enhance the consumer experience.

Revenue target

The new funding will also help HomeLane accelerate its revenue target of ₹2,500 crore by FY24. Despite pandemic challenges, the demand in the second half of last fiscal has already bounced back to the pre-pandemic levels and achieved record cash profitability last November, he said.

The company also plans to enter into new verticals including painting and close this fiscal with a topline of $100 million (about ₹742 crore) as the order book has already doubled to ₹1,500 crore.

Tanuj Choudhry, Co-Founder, HomeLane said the company looks forward to consolidating its position as a leading player in the home interiors segment in India with greater reach, better technologies, and a seamless customer experience.

Chetan Naik, Fund Manager (Private Equity), IIFL AMC said the company is at the forefront of digitisation of home interiors space which has largely been an unorganised play.

Other existing investors in HomeLane include JSW Ventures, Growth Story, Aarin Capital, Baring Private Equity Partners, RB Investments and BCCL.

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PSBs vacating branches open doors for other lenders

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The move by five public sector banks to reduce their branch numbers is proving godsend for lenders looking to expand their network.

The branches being vacated by Bank of Baroda (BoB), Punjab National Bank (PNB), Canara Bank, Union Bank of India (UBI) and Indian Bank have opened the doors to ready-made premises for other lenders. For the latter set, network expansion happens faster, at reasonable costs (as owners of these premises are desperate to rent them out) and without the hassle of re-doing interiors.

To cut down on operating expenses, the five PSBs have been merging or rationalising branches after the amalgamation of banks with them.

AS Rajeev, MD & CEO, Bank of Maharashtra, observed, 25-30 per cent of the branches opened by BoM last year were in the premises vacated by the PSBs. “The rent is comparatively less. That is why our rent outgo is not increasing despite the rise in the number of branches,” he said. BoM, which opened 82 branches last year, plans to open about 100 in FY22.

BK Divakara, CFO, CSB Bank, noted that 30-40 branches opened in 2020 and so far this year have been at premises vacated by a PSB. Divakara said the bank opened 101 branches last year and plans to open 200 this year.

CSB Bank actively scouts for ready-to-move premises being vacated by PSBs to avoid overlap of branches. These premises usually come with a strong-room (constructed to central bank specifications), counters and furnishings.

Branch rationalisation

After the amalgamation of Dena Bank and Vijaya Bank with BoB on April 1, 2019, the latter merged or rationalised 1,310 branches.

PNB rationalised about 430 branches after Oriental Bank of Commerce and United Bank of India were merged with it from April 1, 2020.

Canara Bank merged or closed 105 branches after taking over Syndicate Bank on April 1, 2020.

Union Bank of India merged or closed 275 branches after the amalgamation of Andhra Bank and Corporation Bank with it from April 1, 2020.

Indian Bank rationalised 203 branches after absorbing Allahabad Bank from April 1, 2020.

 

 

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PSBs vacating branches open doors for other lenders

Banking & Finance

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The move by five public sector banks to reduce their branch numbers is proving godsend for lenders looking to expand their network.

The branches being vacated by Bank of Baroda (BoB), Punjab National Bank (PNB), Canara Bank, Union Bank of India (UBI) and Indian Bank have opened the doors to ready-made premises for other lenders. For the latter set, network expansion happens faster, at reasonable costs (as owners of these premises are desperate to rent them out) and without the hassle of re-doing interiors.

To cut down on operating expenses, the five PSBs have been merging or rationalising branches after the amalgamation of banks with them.

AS Rajeev, MD & CEO, Bank of Maharashtra, observed, 25-30 per cent of the branches opened by BoM last year were in the premises vacated by the PSBs. “The rent is comparatively less. That is why our rent outgo is not increasing despite the rise in the number of branches,” he said. BoM, which opened 82 branches last year, plans to open about 100 in FY22.

BK Divakara, CFO, CSB Bank, noted that 30-40 branches opened in 2020 and so far this year have been at premises vacated by a PSB. Divakara said the bank opened 101 branches last year and plans to open 200 this year.

CSB Bank actively scouts for ready-to-move premises being vacated by PSBs to avoid overlap of branches. These premises usually come with a strong-room (constructed to central bank specifications), counters and furnishings.

Branch rationalisation

After the amalgamation of Dena Bank and Vijaya Bank with BoB on April 1, 2019, the latter merged or rationalised 1,310 branches.

PNB rationalised about 430 branches after Oriental Bank of Commerce and United Bank of India were merged with it from April 1, 2020.

Canara Bank merged or closed 105 branches after taking over Syndicate Bank on April 1, 2020.

Union Bank of India merged or closed 275 branches after the amalgamation of Andhra Bank and Corporation Bank with it from April 1, 2020.

Indian Bank rationalised 203 branches after absorbing Allahabad Bank from April 1, 2020.

 

 

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Bill payment startup Xpay Life plans to raise funds for expansion

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Mobile van-based bill payment startup Xpay Life Pvt Ltd is looking to raise funds for expansion.

“COVID-19 disrupted our lives altogether. Our business witnessed a surge, and we successfully initiated our application business during the lockdown. In less than a year, we have grown from zero to 1 million-plus

customer base and have completed over 3 million transactions in the past 8-9 months, crossing a value of over 50 crores. Offering a platform enabling cash-based along with easy and quick digital payments is what differentiates us from the other players,” Rohit Kumar, CEO and Founder, Xpay Life Pvt. Ltd said in a statement.

He said the pandemic initiated the cashless era in India. While the urban areas have already inculcated digital methods for making payments, the rural areas are still in digital adoption.

Seeking this as an opportunity, Xpay works to empower the rural people digitally. It provides a one-stop solution to ensure that the multi-utility bill payment becomes easy and simple by using a combination of mobile vans, Point of Sale devices, and cash Acceptors, the statement said.

Started in 2019 by Rohit Kumar, Xpay’s patented Mobile van Solution comes fitted with an interactive touch screen kiosk and ATM and helps facilitate doorstep banking and payments for rural and regional banks. Using a blockchain-based transaction framework and following the AMBIC model offers various options for bill payments.

Rohit Kumar has self-funded this start-up and has so far invested more than a million dollars. However, the firm is now seeking investment to expand and grow. Presently, Xpay clocks revenue of Rs 75 crore annually, and around 3 lakh consumers pay their bills via XPay Life on an average monthly basis.

The venture has deployed kiosks in 12 cities, including Delhi, Pune and Patna. XPay Life aims to set up 1,000 payment kiosks by the end of 2021 and 1 lakh touch screen kiosks, PoS, along with mobile ATP vans in the next three years.

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Ruptok Fintech raises ₹10 cr from Canadian investment firm Wurk

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Ruptok Fintech Private Ltd, a fintech-platform for gold loans, has raised ₹10 crore in an Angel funding round from Canadian investment firm Wurk.

The company will use the funding to fuel up its business and operations in Jaipur and Mumbai by March , and to acquire manpower, the company said in a statement.

“During the pandemic, we have witnessed several people facing liquidity crunch and selling their assets to accomplish their financial needs. Our idea behind launching Ruptok last year was to offer an easy financing options to the customers at the comfort of their doorstep,” Ankur Gupta, Founder and CEO of Ruptok Fintech, said.

Founded in July 2020 by serial entrepreneur Ankur Gupta and Akshita Gupta (Head HR) and Yashwardhan Aeren (Head Product Development), Ruptok provides instant loans against gold jewellery within 30 minutes.

“Indian fintech market has witnessed a tremendous growth trajectory in past few years, especially during pandemic. The global crisis has brought a fundamental shift in consumers’ behaviour and preferring most of the services at their doorstep. At present, the market is attracting a pool of innovative ideas and distinctive solutions to address the core solutions of the consumers by providing the utmost convenience,” Barbara Holding, a Wurk spokesperson, said.

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Jana SFB expands its branch network to 601

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Jana Small Finance Bank digitally inaugurated 18 bank branches in Maharashtra.

With the conversion of its asset centres to bank branches, Jana Bank’s presence in Maharashtra will reach 70 and 601 all India.

Maharashtra is the second highest of the 22 States where the bank has a presence. Staying true to their promise of paise ki kadar, Jana Bank is all set to increase its footprint across rural India.

Jana Small Finance Bank started its journey in Maharashtra in 2010 and have served over 15 lakh customers in the State who are mainly women. The bank offers unsecured loans to women under the group loan model as well as individual loans for small businesses.

The average loan size for the group loan model is ₹34,900 and individual loan for small businesses ₹60,000. The bank also offers agriculture loan, MSME loans, gold loan, affordable home loan & home improvement loan. With the conversion of asset centres into bank branches our customers will now be able to avail of banking products like savings account, current account, fixed deposits, recurring deposits, OD account.

Ajay Kanwal, MD & CEO, Jana Small Finance Bank said, “All our new branches across Maharashtra have digitised environment with best in class offerings”.

M Rajeshwar Rao, Deputy Governor, Reserve Bank of India said “Credit expansion is an important ingredient of growth and prosperity. There are enormous opportunities to bridge the financial inclusion gap in the country and I am happy to note that Jana Small Finance Bank is committed to do so.”

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