Interview with Satin Creditcare Network Limited

Our continued focus is on lending credit to low-income women micro-entrepreneurs and growing our product portfolio to enhance the digital presence, expresses HP Singh, Chairman and Managing Director, Satin Creditcare Network Ltd.

How is Satin Creditcare Network uniquely positioned to capitalise on the tailwinds propelling India’s credit and lending sector? 

Satin Creditcare Network is an NBFC-MFI (Non-Banking Financial Company - Micro Finance Institution) with a visionary outlook and a strong growth strategy. We have a scalable model and leverage these factors to build a financially inclusive ecosystem within the rural and semi-urban areas. We are active in more than 23 states and around 75% of our portfolio is in rural areas.

During the pandemic, we were quick-thinkers. As we realized that our field employees were going to be unable to connect with our customers, we commenced the efforts for setting up a digital platform. We introduced online payments for the repayment of loans and helped our customers and their communities by conducting safety seminars.

The company is currently leveraging our technology to expand into the pro-digital era. This gives us leverage to capitalize on the expectations within the lending sector. We are also focusing on diversifying our products to reach new high-potential customers and also on strengthening our existing customer base who were irregular in repayments due to the pandemic by improving their credit history.

What is the AUM growth that you are targeting?

Our AUM for FY22 stood at Rs 7,617 crore. We witnessed an increased disbursement of loans during the last quarter as well as a higher loan repayment rate. Our board approved raising Rs 225 crore a few months ago. Leveraging this capital, we have high hopes and strategic plans in place for increasing our business. With a tight growth plan and capital in place, we have a goal to generate 20% AUM growth during the financial year 2022-23.

Can you highlight some of the biggest challenges you are currently facing?

The pandemic has been a testing time for a lot of people and businesses. The MFI sector took a huge hit during this time. A lot of our customers lost their livelihoods and it became more difficult for our field employees to check in with our customers and conduct loan repayment. Owing to this, we restricted new disbursements and focused on asset quality. The efforts paid off, and we saw fresh PAR addition on only 0.4% by the loans disbursed since July 22.

Currently, with the new changes in the Regulatory Framework by the RBI for the microfinance industry, certain challenges are being faced in the implementation of the proposed guidelines in terms of technology and subjectivity in assessed income, etc. However, going forward, it will serve as a strong foundation for MFIs with a level playing field for all lenders. 

What is your earnings outlook for FY23?

We have new plans in motion for our earnings outlook for FY23. The company allotted equity shares and warrants of Rs 225 crore to expand our business and achieve an AUM growth of 20% in FY22-23. We are looking to enhance our loan portfolio and are reaching out to more people in the areas we are situated in.

Satin Creditcare Network is currently in over 23 states and plans to strategically deep dive into high-potential rural areas. Our continued focus is on lending credit to low-income women micro-entrepreneurs. We are also working on growing our product portfolio and enhancing our digital presence. Apart from our microfinance portfolio, we are seeing growth in the books of our subsidiaries, which provide loans to micro, medium, and small businesses, as well as in the affordable housing market, and expect this trend to continue in the coming year.