Bajaj Fin Q4 hit by rural loan losses, RBI curbs
Bajaj Finance’s managing director Rajeev Jain on Thursday said the company faced challenges on two fronts in the March quarter: higher loan losses in personal loans to rural customers, and the ongoing impact of Reserve Bank of India’s (RBI) restrictions on its business. Bajaj was speaking in a call with analysts after announcing the company’s latest quarter results.
Last November, RBI had asked the lender to stop giving fresh loans under its lending products ECOM and Insta EMI Card, citing non-compliance with digital lending guidelines.
Meanwhile, the consumer financier has been speaking cautiously about the rural b2c (business-to-consumer) segment that comprises personal loans to salaried, self-employed customers and professionals.
On rural b2c, the lender has, as a strategy, decided to go slow on growth. The assets under management (AUM) growth of rural b2c—excluding gold loans—have shrunk from 25% in March 2023 to 6% in March 2024. The AUM stood at ₹17,607 crore, comprising 5.3% of aggregate consolidated AUM as on 31 March, as against 6.7% in the same period last year. In fact, Bajaj Finance said that risk metrics across all businesses were stable except rural b2c.
For the quarter ended 31 March, Bajaj Finance posted a consolidated net profit of ₹3,825 crore, up 21% year-onyear, beating analyst expectations. Bloomberg estimates had pegged profit at ₹3,785 crore.