M&M Finance eyes ~20,000-crore small-ticket loans via e-platform

With competition getting tough, M&M Financial Services, a financer for automotive and tractors, is eyeing substantial business from the consumer credit segment through its digital platform.

The firm expects to disburse short-term credit of ~20,000 crore predominantly to its existing customers over three years through digital business unit. This will run as an independent unit within the company.

The company expects to build a strong balance sheet (in digital business unit) which will not just add to the growth of M&M Finance but also help to retain existing customers.

While the company does not see too much of competitive pressures, some players are trying to enter tractor and utility vehicle financing.

M&M Finance is also looking at alternative possibilities, hence set up its digital business unit, said Ramesh Iyer, vice-chairman and managing director of the company.

The firm has appointed Amit Raje as whole-time director designated as chief operating officer (digital finance business) from April 01, 2021.

According to Iyer, the company has a customer base of 2.5 million and adds 0.75-0.8 million customers each year. These in-house customers are available to start with.

The unit would give smallticket loans — personal and consumer durable credit — to existing customers who have a good payment record for 12 months.

At present, many of them have been sourcing funds from families, trading communities, and money lenders.