Fingrowth Coop Bank ..............................
Ashok Kumar Shah, MD, Fingrowth Cooperative Bank, explains how the multi- state bank has been achieving growth over the years and how it proposes to continue:
Fingrowth Cooperative Bank is a multi-state cooperative bank having 22 branches in Rajasthan and Gujarat and 4 on-site ATMs. The bank has not added any branch in the last financial year as RBI has withheld branch licensing for cooperative banks during the last 4 years as the licensing policy for is under revision. Ashok Kumar Shah, MD of the bank, says thee bank proposed to add 2 on-site ATMs and 3 branches by the end of 2019-20 subject to approval by the RBI.
The bank’s branches have adequate security system and fire-fighting equipment. There is provision for safe drinking water and all the branches are air-conditioned. Explains Shah: “We have provided armed security guards at each branch and there is 24-hour security at the head office. The branches have ramps for physically challenged / disabled customers.”
PRODUCTS SUITING CUSTOMERS
The bank firmly believes that only when there is satisfied customers, it can multiply its business. Therefore, improving customer service is an ongoing process.
Fingrowth Cooperative Bank is essentially an urban bank and since its branches are located in cities and towns, it does not have farmers as its customers. There are customer complaint boxes at branches and complaints received are resolved expeditiously. “We have been organizing customers’ meet at least once in a year at the branch level where customers from all segments can have face-to-face interaction with the bank officials and resolve any issues within the policy framework. Moreover, mobile numbers of 2 senior officers of head office are displayed at each branch and customers are free to discuss their problems / suggestions with these officers during banking hours,” says Shah.
The bank has been taking up regular market surveys to ascertain the need for new loan products in any particular segment of customers.
The customers of the bank as of Q2 2019-20 is around 60,000. It plans to add more depositors and borrowers to take the number to 65,000 by end of the current FY.
ZERO NPA FOR 16 YEARS
The bank has been a zero NPA bank for the last 16 years. It has framed corporate governance and regulatory compliance norms. It has a very healthy provision for NPAs of `97.76 million.
CASA, LOAN GROWTH
The bank has a CASA of more than 51.9% reflecting the faith of its customers. Home loans, including mortgage loans, are a key segment of its advances. The other advances include commercial loans, CC loans and mortgages. Shah updates: These 3 segments constitute 31%, 19% and 18%, says Shah.
The bank offers term loans and CC limits to MSMEs and traders, which constitute 19% of the total loan portfolio. Its total business in the second quarter of the current financial year increased to `5.64 billion. Investments increased from `1.46 billion in 2016-17 to `1.68 billion in 2018-19 and `1.77 billion as on 30 September 2019. Shah says intra-bank deposits have increased from `468.1 million in 2017-18 to `586.6 million in 2018-19. The bank has a net worth of ` 813.3 million and capital of ` 58 million.
UPGRADED IT SERVICES
The bank has mobile banking facility and offers IMPS 24x7 in addition to other services like fund transfer through RTGS / NEFT on mobile application. It has launched a platinum variant RuPay EMV chip card with features of eCommerce accessible at more than 200,000 ATMs nationwide.
Shah says the bank plans to implement UPI and net banking for transactions shortly. It already has biometric authentication as second factor of authentication for core banking access by internal users.
VENDORS OF CBS, ATM
The bank has implemented CBS Bancs@24 on an ASP model and hence does not need a large IT team. It has a 6-member team, who are experts in software development as well as hardware maintenance. ATM cards printing is outsourced through the CBS vendor. Access to onsite ATMs is available from 7 am to 10 pm. On an average 500 transactions happen at the onsite ATMs. The bank’s main IT vendor is C-Edge Technologies. AML and KYC software is provided by BSG IT Soft.
LONG TERM TARGETS
The bank has set the financial targets for 2019-20 and created a long-term prospective plan for 2021-23. Says Shah: “We have decided to keep a target of `1.1 billion for new loans advances and `4.15 billion for deposits for 2019-20. Our net NPA will continue to be zero. We have also set a target of `1.7 billion for loans and advances and `4.6 billion for deposits for 2022-23.”