Federal bank’s NBFC arm to invest Rs 100 crore for expansion

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Published: February 21, 2019 12:17 AM

Fedbank Financial Services (Fedfina), the NBFC subsidiary of the Kerala-based private sector lender Federal Bank, has allocated a budget of Rs 100 crore to fuel its expansion goals and drive growth.

Federal Bank’s NBFC arm to invest Rs 100 cr for expansionFederal Bank’s NBFC arm to invest Rs 100 cr for expansion

Fedbank Financial Services (Fedfina), the NBFC subsidiary of the Kerala-based private sector lender Federal Bank, has allocated a budget of Rs 100 crore to fuel its expansion goals and drive growth.

Tamil Nadu will continue to be a strong focal point for the firm, with several high-performance branches in Chennai. Along with its gold loan business, Fedfina is looking at growing its mortgage, unsecured loans and other loan products in the state. Fedfina also plans to open 25 branches as part of this expansion.

As part of its plan to strengthen its network to 500 branches from the current 140, the company would scale up operations in the rest of the country. Fedfina has set up 25 branches in the current financial year and is looking at adding another 125 branches in the next 12 months across India.

Speaking at a press conference on Wednesday, Anil Kothuri, MD and CEO, Fedfina said: “Fedfina caters to the needs of the small self-employed individuals across small town India. This is a rapidly growing, yet financially under-served segment of society. We aim to scale up our balance sheet by 10 times in the next five years by offering products that recognise the financial stature of these customers and thereby providing appropriate loan amounts.”

Private equity firm True North recently acquired 26% stake in the firm. Along with growth capital, True North is supporting Fedfina’s plans to transform into one of India’s most customer-centric and admired financial institutions.

“One-third of our branches are based in Tamil Nadu, which makes it a very crucial market for us. The well-developed credit culture here and financially literate set of borrowers will ensure greater credit penetration in the state,” he added.

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