Bringing social into the lending process
Govind Sankaranarayanan, COO, Retail Business & Housing Finance at Tata Capital, reveals the product innovations and digital foundations at Tata Capital:
Mehul Dani: What are the growth indicators of your company in 2016-17? How was 2016-17 different from the previous year in terms of business, challenges and opportunities?
Govind Sankaranarayanan: We have focused on high potential areas to grow our business. Affordable housing, as a segment, has been growing rapidly and our share of home loans to this segment have been in line with this. We have also begun to focus on loans for more niche needs like travel, medical, weddings, etc. Digital as an area for acquiring business has also been a focus area and will continue to be so in the years to come. We are currently growing at a y/y rate of 25-30%. Our loan book for FY 201617, on the retail and housing finance front, was close to `29,000 crore.
What new products were offered by your company in 2016-17 and how has been the response? How do you propose to bring in product innovations in 2017-18? What are the marketing, branding and promotional activities planned for different products in 2017-18?
Most recently, we launched ‘myloan’ - a first-of-its kind mobile app by Tata Capital to extend its existing personal loan offering to the emerging younger and mobile savvy audience. The app enables the user to check his/her loan eligibility and apply for a loan seamlessly using only a mobile device. The app also allows existing customers to view their loan status and details. These products constitute around 5-10% of our personal loan portfolio and are growing at a rate commensurate with the rest of our products.
One of our more recent initiatives in the current FY which was launched under Tata Capital’s ‘Do Right’ brand initiative is ‘Salaam Loans’ - a unique and special product, crafted to extend loans to deserving individuals who may not have access to organized credit. ‘Salaam Loans’ is a firstof-a-kind initiative which puts the power of loan approval into the hands of people, calling the public at large to ‘salaam’ the stories of such deserving individuals. People can visit www.doright.in to nominate, share and like/salaam the stories of such individuals, thereby effecting social change.
The initiative aims to salute the unbreakable spirit of those people who brave severe circumstances and yet dare to dream big and pursue their dreams with relentless determination. Unsecured personal loans are offered across a range of profiles, but still many individuals are unable to get access to finance on account of reasons such as insufficient credit history, inadequate / irregular income and improper documentation.
Under the Salaam Loans initiative, individuals would be able to upload their own story. Stories of these individuals will be showcased across the country via social and digital media. The role of the public is critical in this initiative’. Once the story is approved by the ‘salaams’ of the public, it will be processed by Tata Capital. We have given the power of approval to the public to help fulfill their dreams with this unique product. Salaam loans are personal loans, offered up to `1 lakh, at heavily discounted rates.
What changes have you introduced on information technology front in last one year? How are you using social media?
Tata Capital is strongly focused on embracing the power of digital and building superior experiences for the digital customer. Our social journey began in 2011, by carving out a separate digital portfolio in 2014 and subsequently the digital business as a separate vertical was formed in April 2016.
The company’s digital strategy is built on a few key pillars. First, we are undertaking digital initiatives to expand our reach and growth across geographies and customer segments to achieve top-line growth. Second, we are looking at ways to convert our existing offline financial products into digital-friendly products. Third, we are trying to create new business models around digital – products and propositions that are purely digital. Fourth, we are attempting to decode the extensive customer data available and use it for intelligent analytics and insights across the business functions. Fifth is enhancing customer experiences through digital.
From a social media standpoint, Tata Capital currently employs a social listening tool to assess trends, customer behavior, etc, from social media. The system helps us to reach out to customers in need of our financial products as well as identify gaps, if any, at a macro level for developing new products.
Govind Sankaranarayanan is strongly focused on embracing the power of digital and building superior experiences for the customers
What is the default rate in repayment of loans of your company in 2016-17?
Our NPA rate is currently among the best in the industry.