Ujjivan Small Finance Financial institution (SFB) expects readability on its common banking licence utility by December this yr. The financial institution additionally plans to boost round Rs 2,000 crore via a professional institutional placement (QIP) over the following 18–24 months to assist development, says Sanjeev Nautiyal, MD and CEO, Ujjivan Small Finance Financial institution.
The financial institution confirmed that its utility, filed in February, has gone via a number of rounds of clarifications with the central financial institution and is now in a complicated stage of processing. “We stay hopeful our credibility, integrity and observe file,” Nautiyal mentioned, whereas underlining that the plan to increase stays unchanged whatever the consequence.
The administration careworn that its five-year roadmap is unbiased of the RBI’s determination, although a conversion right into a common financial institution would open extra doorways and alternatives for the lender.
On the expansion facet, Ujjivan reiterated its dedication to enterprise and microfinance loans, highlighting that its underwriting, buyer choice and assortment mechanisms have left its e-book more healthy than the business throughout latest headwinds.
The administration additionally clarified that its capital-raising plans are tied to its broader steadiness sheet objective of attaining a Rs 1 lakh crore gross mortgage e-book by 2030. “This 2,000 crore is a part of our strategic plan and is regardless of the RBI’s determination,” they mentioned.
The financial institution is concurrently stepping up its know-how investments. It at present spends about Rs 200 crore yearly on IT, three-fourths on operating operations and a fourth on new initiatives however expects to scale this as much as almost Rs 500 crore over the following 5 years.
Retail lending stays the mainstay, accounting for over 90% of the steadiness sheet, with a deliberate shift in the direction of secured loans. The share of secured property has risen from 30% in March 2024 to 46% by June, and is projected to climb to 65–70% by FY30. This diversification, administration famous, would deliver stability, cut back volatility, and improve earnings visibility.
On the microfinance portfolio, Ujjivan acknowledged the stress the sector confronted previously decade however mentioned delinquencies have peaked throughout most states, and restoration is underway. “The pains are already behind us… development is across the nook,” Nautiyal added.
Trying forward, Ujjivan maintains {that a} common financial institution licence can be an optimum consequence to execute its technique quicker and make its model extra aggressive, however the give attention to grassroots MSMEs, retail debtors, and technology-led development will proceed regardless of regulatory choices.
