Money & Banking

Fusion eyes 40% growth in AUM in FY20

New Delhi | Updated on September 27, 2019 Published on September 27, 2019

Fusion Microfinance, a microfinance lender focussed on rural India, is eyeing at least 40 per cent growth in assets under management (AUM) this fiscal, and hopes to end this fiscal with an AUM of ₹3,600 crore, said Devesh Sachdev, Managing Director and CEO.

As on date, AUM has already touched ₹3,000 crore, Sachdev told BusinessLine.

Fusion Microfinance, a company in which Warburg Pincus had pumped in equity capital of ₹450 crore last year, is also looking to expand its branch network to 600 by March-end next fiscal, from the current level of 550, he said.

The microfinance lender, which now has operations in 18 States, will soon launch a micro-SME product through a separate vertical, added Sachdev. Sachdev said the company had evaluated several products before zeroing on a ‘micro-SME’ product.

“We wanted to do something adjacent to the markets we operate in. Second, we wanted to be in a more informal segment. Micro-SME is still an untapped segment, especially ₹1-10 lakh loans, and there is real need there. Getting into micro-SME segment is also in line with our positioning as a rural-focussed financial services company,” he said.

Micro-SME is an area where the company feels it can do something on product innovation, said Sachdev. “We expect our micro-SME product will go live in November (after festival season),” he said.

In 2018-19, Fusion Microfinance had recorded a net profit of ₹65 crore. This microfinance lender expects to close the current fiscal with a net profit of ₹100 crore, said Sachdev.

At present, Fusion Microfinance provides micro-credit services through the Joint Liability Group lending model to women entrepreneurs from the low-income segment in unbanked and under-banked areas. Started in 2010, Fusion is now one of the 10 leading NBFC-MFIs in the country. It is also looking to expand its customer base to 2 million from 1.7 million at present.

No IPO for now

Asked if Fusion Microfinance will look to list in the bourses, he replied in the negative.

“I am a marathon player. I want to build a sustainable business for the coming years before thinking about an IPO,” he said.

Published on September 27, 2019
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