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Fino Paytech has launched its banking operations, adding to the burgeoning competition in the newly-created payments bank segment.
Fino is the fourth such player in this segment after Airtel, IndiaPost and Paytm. At a time when the already launched payments banks are yet to scale up, Fino has gone live with 410 branches across 14 States with 25,000 banking points, the largest so far in the segment.
Others such as Reliance-SBI and Idea are yet to get final RBI approval for the same.
Talking to BusinessLine , Rishi Gupta, MD and CEO of Fino, said the bank has a target of mobilising deposits worth ₹10,000 crore over the next three years by acquiring about 50 million customers. Besides, the payments bank is also optimistic about turning profitable by 2020.
“We will post losses this year since we are in expansion mode, but in the second year we would start consolidating and focus on profitability. At the group level, we are already profitable,” Gupta said, adding that the company in the last one year has invested heavily in technology and has doubled its headcount.
The ICICI Bank and oil major BPCL-backed company, which raised ₹400 crore in equity in the last round, is looking to raise another ₹150-200 crore soon from the same set of investors to fuel its expansion plans and launch new products.
The bank, which has kept its interest rate at 4 per cent, will be focussing on acquiring customers with earning capacity of ₹1.5-5.6 lakh, Gupta said, adding that the company would rather compete by offering better customer service than high interest rates.
The company is already providing remittance and insurance services and is also in the lending business through a tie-up with about 12 banks since payments banks, as per RBI rules, can only take deposits and not lend.
On the current and major challenges in the payment banks business for Fino, Gupta said that while connectivity, awareness and reach still remain challenges, the biggest of all is the change in culture within the company that is now transforming from a banking correspondent to a bank.
Fino will also tap BPCL and ICICI Bank’s facilities for expanding its banking reach.
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