Ra­jashree Nam­biar

Dalal Street Investment Journal - - COVER STORY -

you let us know the growth rates you have wit­nessed in each of these in­di­vid­ual seg­ments?

We wit­nessed strong growth in our SME loans seg­ment in FY17, while mort­gages grew at ~42 per cent.

The out­look fore var­i­ous seg­ments are as fol­lows:

SME Loans – Rid­ing on the favourable macro en­vi­ron­men­tal con­di­tions and in-house digi­ti­sa­tion ini­tia­tives – SME lend­ing at IIFL is poised for ex­po­nen­tial growth. Re­cent gov­ern­ment re­forms will fur­ther aid the lend­ing in­dus­try:

• Due to de­mon­eti­sa­tion, adop­tion of the dig­i­tal pay­ment sys­tem has shown sig­nif­i­cant improvement by MSMES, which opens up lend­ing op­por­tu­nity.

• Im­ple­men­ta­tion of GST bill is ex­pected to ben­e­fit MSMES not only with sim­pler tax struc­ture but also with as­pects such as im­proved tech­nol­ogy adop­tion in or­der to com­ply with GST sys­tem and pro­vide lender ac­cess to the trans­ac­tion data through GST por­tal.

SME loans aim at digi­tis­ing the pro­cesses to en­sure seam­less pro­cess­ing of files with min­i­mum man­ual in­ter­ven­tion and meet­ing the cus­tomers’ fi­nan­cial re­quire­ments. 100 per cent of the re­tail MSME loans will be sourced dig­i­tally, en­sur­ing faster de­liv­ery.

Hous­ing Fi­nance – The mar­ket po­ten­tial of af­ford­able hous­ing projects in the

com­pany, IIFL is mak­ing all the right moves in the wealth man­age­ment busi­ness and is now fo­cus­ing on build­ing its credit busi­nesses. IIFL & Edel­weiss have a healthy prod­uct mix and have di­ver­si­fied in­come streams.

The beauty of in­vest­ing in NBFC sec­tor is that you will in­vest in busi­nesses with unique busi­ness mod­els op­er­at­ing in coun­try is ex­pected to touch ₹6.25 tril­lion by 2022 (source – ICRA) due to de­mand em­a­nat­ing from a grow­ing pop­u­la­tion and the dis­par­ity that ex­ists in house­hold in­come and high real es­tate prices. In ad­di­tion, the gov­ern­ment has pro­vided var­i­ous in­cen­tives to home buy­ers, tar­geted at the af­ford­able hous­ing seg­ment, which is ex­pected to fur­ther aug­ment the de­mand.

How is digi­ti­sa­tion shap­ing your strat­egy? What is your an­nual dig­i­tal spend?

• We are fo­cussed on im­ple­ment­ing end-to-end digi­tised prod­ucts and pro­cesses. We have been able to en­hance our pro­cesses and im­prove our ser­vices based on the dig­i­tal ini­tia­tives across all prod­ucts and cus­tomer life cy­cle.

• We are now dig­i­tally on-board­ing cus­tomers through web and Tab­based ser­vices across all our prod­ucts. Backed by EKYC, es­ign and ro­bust real time ap­praisal process, we are now able to dis­burse loan in seam­less and al­most pa­per­less man­ner. With ENACH be­ing im­ple­mented, we are geared up to dis­burse our loans in com­pletely dig­i­tal and pa­per­less mode.

• We con­tinue to in­vest dis­pro­por­tion­ately in build­ing our dig­i­tal plat­forms and ca­pa­bil­i­ties. As re­gards mar­ket­ing spend, our con­scious aim is to spend on both on­line and off­line plat­forms, as ap­pro­pri­ate.

high yield, high growth, high mar­gin busi­nesses which are also ag­ile. Ag­ile struc­tures and set-ups of most of the NBFCS al­lows these com­pa­nies to quickly spot growth op­por­tu­ni­ties in new re­lated ar­eas. You may well be buy­ing a dif­fer­ent NBFC stock for an al­to­gether dif­fer­ent rea­son. The IT in­fra­struc­ture is in place for most of the play­ers and the tech­nol­ogy is

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