Also plans to add branches, ATMs:
The Fingrowth Cooperative Bank was established in 1959 by the late Harish Golcha. It now has 22 branches and 4 ATMs in Rajasthan and Gujarat. In 201718, it added 1 ATM. It is proposing to add 3 more branches in Udaipur, Ahmedabad and Surat during the current financial year subject to RBI approval, while 2 more ATMs are to be added by the end of 2018-19.
The bank has 129 employees at present against 136 in 2016-17. According to S.K. Golcha, chairman of the bank, there is need for more professionals for canvassing customers and doing systematic business development for the branches. He adds that business per employee has increased to `40.10 million in 2017-18 from `30.77 million a year ago.
As on 31 March 2018, the bank has more than 70,000 customers. Its branches have the latest locker infrastructure with mirror facilities. There are 4880 lockers available to the customers. The bank has reduced interest rates on certain loan products so as to attract new customers. Says Golcha: “We are targeting to increase our customer base to 75,000 by March 2019. We have also increased repayment periods up to 20 years for housing loans to suit certain class of customers.”
The bank has obtained ‘A’ grade and has its own funds of over `740 million. It has 6507 shareholders and serves people in the low and medium income groups. It servers trading community, workers and laborers to whom it offers credit. Deposits as on 31 March 2018 are to the tune of `3.52 billion, up from `3.46 billion a year ago and loans of `1.92 billion, up from `1.66 billion a year ago. Says Golcha: “We had given housing loans of `70.7 million (6.47% of total loans) and CC/OD loans of `90.57 million (8.09%) during 2017-18. We have achieved a growth rate of 15.79% for loans and 1.82% for deposits during 2017-18.”
The bank has reduced interest rates for housing loans from 9.8% to 9%, for gold loans from 13% to 12.5% and for mortgage loans from 13.25% to 12.75% in order to attract new borrowers. After presanctioning visits, all eligible applicants are sanctioned loans.
“We have given total loans of `180.81 million in Q1, 2018-19. Of these, `20.65 million worth of loans are to the MSME sector and `160.17 mn to other sectors including infrastructure. We are strengthening our housing finance portfolio during the next 12 months. Our loan processing/sanctioning time is only 6-10 working days,” says Golcha.
The bank has implemented core banking solution and has own RuPay debit card, NEFT/RTGS, mobile banking, net banking (view only) and PoS facilities. C-Edge Technologies is the technology partner for the bank. At present, there are 4 members in the IT team of the bank. On an average, 50-60 transactions are taking place per ATM of the bank.
The bank’s gross NPA stands at `20.7 million (1.4%) as on 31 March 2018. It has excess provision of `64 million over and above the provisions required for gross NPA. Golcha points out that the net NPA is zero for last 15 years in a row. The staff members are personally in touch with the borrowers to recover overdue installments and make the accounts regular, he adds.
THIRD PARTY PRODUCTS
The bank has offers Pradhan Mantri Suraksha Beema Yojna (PMSBY) accident policy for its customers providing insurance protection in case of accidents. It also offers group protection plan with low premium to its borrowers providing cover in case of accidental or natural death during the period of the loan. “We have tie-ups with 4 mutual funds for investments, 2 insurance companies on referral basis for our members as well as loan holders. Our noninterest income has substantially increased from `30.15 million in 2016-17 to `40.71 million in 2017-18.”
TARGETS AND GROWTH
The bank recorded a total business of around `5.45 billion by the end of March 2018. Says Golcha: “We are targeting to achieve deposits of `3.8 billion and loans of `2 billion, ie a total business of around `5.8 billion by the end of March 2019.”
Branch managers’ conference being addressed by A. K. Shah, managing director.
S.K. Golcha claims employee productivity in the bank has grown 30% during last FY