The Hindu Business Line : Citigroup keen on tapping rural financial market

Hyderabad May 11 In view of the vibrant financial market, India tops the list of priority countries in the global strategy of financial services major Citigroup, according to Mr Robert A. Annibale, Global Director of Microfinance.

"The potential of financial market is very huge in India where the markets are new and financial systems are vibrant. India and Mexico are very important for us," Mr Annibale told Business Line here.

There was enormous opportunity for rural credit besides savings and insurance in India, he said adding: "Currently, we are investing in India and our expectations too are simple on profit margins. But we see a great potential down the line."

The Citigroup is exploring the partnership route to expand into the countryside in India and had recently tied up with SKS Microfinance for distribution of micro credit.

More partnerships

"In Bangladesh, we tied up with the largest non-governmental organisation called BRAC, which has access to six million rural folk and invested $180 million. We wish to replicate the model in its full strength in India," he said.

The company is already present in Delhi, Bihar, West Bengal, Andhra Pradesh, Karnataka and Chennai by partnering with MFIs and NGOs.

"We are open for more partnerships," Mr Annibale said.

On India plans, he said moves were afoot to launch "a very low balance savings product" which would be suitable to the rural areas. Citigroup's global consumer bank recently launched a micro savings product called Pragati with an offer of biometric ATM in six languages.

Insurance products

On the insurance products, Mr Annibale said it might take some time to foray into insurance in a big way. "In Mexico, we have micro-insurance policies with over 6.5 lakh clients but here our immediate focus will be on tapping micro savings," he said.

On the interest rates in micro finance sector, he said globally the interest rates were declining due to heavy competition and interventions by regulators. "We see it happening in countries like India, Kenya and Africa," he said.

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