Hyderabad-based lender Spandana Sphoorty Financial is planning to scale up the micro-loan against property (LAP) and nano-enterprise book in 2024-25 (April-March). Both these products are offered by the company’s subsidiary CRISS Financial. “We started micro-LAP and non-enterprise loan in five states last year and build a book of Rs 52 crore and around 3,000 customers there. We are planning to take that book to Rs 400-500 crore this year,” managing director and chief executive officer Shalabh Saxena said. “We are eager to pursue that line because it adds a secured portion to our overall portfolio,”
he added.
The average ticket size for micro loan against property is Rs 5 lakh. The average ticket size for nano-enterprise loans, or loans to shopkeepers ranges from Rs 50,000 to Rs 1 lakh. The company has launched these products in Rajasthan, Madhya Pradesh, Andhra Pradesh, Karnataka, and Tamil Nadu. The company is developing a digital application where existing customers can access account details online.
The application will likely be launched by September 30.The microfinance company’s assets under management rose 41% year-on-year to Rs 11,973 crore as on March 31. Disbursements rose 30% year-on-year to Rs 3,970 crore in the March quarter. The net interest margin rose to 14.6% in the March quarter from 13.9% a year ago.
“We disbursed slightly smoothly during the quarter so we were able to plan better. Secondly, we borrowed in a very refined manner. We borrowed according to plan. I would attribute the increase in margins to efficient liability management,” he said. The company intends to hit an asset under management of Rs 15,000 crore by the end of the current financial year. The net interest margin will likely range between 13.8-14.2%.
“This year, we are looking to improve the quality of the franchise by increasing our share from banks because banks lend at slightly lower rates than other options in the market,” he said, adding that the company plans to increase its bank borrowing mix to 65-70% from 52% currently. This will help the company reduce costs by 25-30 basis points, and this will be passed on to customers.
Spandana Sphoorty has already reduced the interest rate on its loans by 100 basis points for customers who have availed more than six loans. The company plans to reduce interest rate by over 25 basis points for existing customers in the next two months.