Credit and Finance for MSMEs: DBS Bank India, the wholly-owned subsidiary of Singapore-headquartered lender DBS Bank, is planning to scale up its retail and SME loan book over the next five years from its current predominant focus on corporate and institutional lending, BusinessLine reported. “DBS Bank India is still largely an institutional bank with 60-70 per cent of our overall revenues coming from corporates, especially large ones. Over the next five years, we expect the balance to become 40 per cent of corporate and 60 per cent of consumer banking and SMEs,” Bharath Mani, Executive Director & Head – National Distribution, DBS Bank, BusinessLine quoted him as saying.

The bank’s loan book in the financial year 2021-22 stood at Rs 43,898 crore, of which large corporates’ share was around 60 per cent while the remaining exposure was equally divided between SME and retail. Mani said while the corporate segment will continue to bolster the bank’s incremental revenue for the coming two years, “but, in the next 24-36 months, revenues from the consumer and SME will start lifting their weights.” DBS Bank is working on its products, geography focus, pricing and customer segmentation for the change in the current lending mix.

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The Reserve Bank of India (RBI) back in November 2020 had approved the merger of Lakshmi Vilas Bank (LVB) with DBS Bank India Limited which gave the latter a strong foothold in south India. This helped DBS Bank expand its network to approximately 600 branches across 19 states and also a large base of retail customers with a strong current & savings account (CASA) balance apart from products including education loans, commercial vehicle financing, and gold loans.

“Gold loan was completely alien to us but that’s an area where we did a very good job in terms of understanding the product and its dynamics. Currently, the gold loan book is about Rs 4,500 crore and we want to grow this by three times in the next five years,” Mani said.

While MSME loans will continue to be among the key growth pillars, the lending format will be overhauled with more use of analytics and technology, he added.

“We are progressing well towards our desired vision at a good pace on all four pillars despite the pandemic-related challenges,” Mani said putting the amalgamation process under four pillars product and process, systems and technology, people, and brand.

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With respect to branding, according to Mani, customers across branches in India will get the same level of service, proposition and product after the final stage of branding is over. He said, “By the end of this year, we will be close to 90 per cent of where we want to be and once it is done it will be a continuous improvement as we move on.”