Bandhan, India's most significant microfinance business, with a $1. 6bn outstanding loan collection, is getting ready to make the step from company of small , unsecured loans to poor countryside borrowers to fully-fledged traditional bank that can take deposits and give other financial services, including bigger, longer-term secured loans. Becoming a financial institution will bring about dramatic changes to Bandhan, the 16, 500 employees as well as 6. a few million credit seekers. For a smooth transition and a lasting impact, Bandhan will need a strategic construction in place. Between many things, Bandhan must concentrate on the following: 1 ) Target Client
Bandhan will now be contending with 101 scheduled banking institutions and thus need to continue to play to its strength my spouse and i. e. country and financially weaker customers. Their " Micro-bankingвЂќ vertical with its confirmed expertise in small loan business ought to continue to link the last mile gap between bank as well as the customer inside the rural region. The modus operandi must stay the same - personal speak to. Field staff (which are over 15, 000 in number) should provide doorstep services together with the handhold devices for money pay in and revulsion. Their second vertical of " Standard BankingвЂќ should particularly provide loans to SMEs and MSMEs beneath priority sector lending. Because their penetration is high in Eastern India, particularly West Bengal, the majority of their six-hundred branches should be targeting this place. The low income states, particularly Bihar, Chhattisgarh, Madhya Pradesh and UP, and North-eastern states amount to INR 3. 2 trillion in the viable and addressable personal debt demand which is 32. 3%1 of the debts demand inside the MSME sector. Thus Bandhan should try to quickly broaden into these kinds of states to improve their image of a " Pro-PoorвЂќ Lender.
2 . Products
At first, Bandhan should offer vanilla products. For the liability area, there will be personal savings and fixed deposits and on the asset aspect, besides all their loan collection, they can give small loans for industrial vehicles and affordable real estate. Over the subsequent...