The Indian branch of London-headquartered Standard Chartered Bank is targeting a 40% share for retail advances in its loan book, up from 29% now, said Zarin Daruwala, the bank’s India chief executive officer (CEO), refusing to share a timeline for meeting the target.
The Indian branch of London-headquartered Standard Chartered Bank is targeting a 40% share for retail advances in its loan book, up from 29% now, said Zarin Daruwala, the bank’s India chief executive officer (CEO), refusing to share a timeline for meeting the target. She was speaking at the launch of the bank’s retail digital banking campaign and added that it will have to lean on digital channels to beef up its retail book. “Being a foreign bank, we don’t have the kind of reach in terms of branches that other banks have. So being a bank with a limited branch presence, we are using digital as a way of reaching out to our customers,” she said. “We are trying to grow retail as a proportion of our balance sheet. Today, retail is much lesser. Ideally, we would like to take retail to about 40%,” she added.
At the same time, the bank has no plans of reducing its branch footprint in India as being a foreign bank, it already has a relatively smaller branch network of about 100 here. In comparison, large private lenders HDFC Bank, ICICI Bank and Axis Bank had networks with 4,730, 4,860 and 3,583 branches, respectively, at the end of December 2017. The other foreign banks with a sizeable presence in India, Citibank and HSBC, had 35 and 26 branches, respectively. Of the retail loans on Standard Chartered’s India book, only about 20% are unsecured. The bank is already sourcing many of its new unsecured-loan customers through the digital route, Daruwala said.
“In retail banking, we are now sourcing 20% of our new-to-bank credit card customers and about 20% of our personal loans through digital channels,” she observed.
Standard Chartered in India would like to “correct” the higher share of corporate loans in its book, Daruwala said, adding that in any economic cycle, it is the corporate book where impairments crop up. “Typically, in India, our experience is that thanks to bureaus, thanks to many other technologies, etc, the retail credit quality has been pretty good. We’ve seen that in a couple of economic cycles, the retail credit quality has stood firm,” she said.