Money & Banking

Piramal Retail Finance enters consumer & used car finance

Our Bureau Mumbai | Updated on April 16, 2021

Eyes ₹3,000 crore of new loan book originations

 

With a focus on retail lending, Piramal Retail Finance on Thursday announced its foray into consumer and used car finance, even as it expects the retail share of the lending book of the Piramal Group to increase to over 40 per cent with the merger of Dewan Housing Finance Corporation Ltd (DHFL) with Piramal Capital and Housing Finance Ltd.

“The overall lending book is at about ₹45,000 crore, of which ₹5,000 crore or 11 per cent of the total lending book is from retail. DHFL book has got a substantial retail portion as well. By end of the fiscal year, retail share of the financial services business is likely to grow to mid-40s,” said Jairam Sridharan, Chief Executive Officer, Piramal Retail Finance.

Focus on Non-mortgage products

In the medium term, it plans to grow the retail book to about two-thirds of the financial services business.

“With DHFL, though we have launched a lot of non-mortgage products, our business will become very mortgage heavy. We are keen to launch more non-mortgage products so that we can cross sell products to these consumers as and when the transaction happens,” Sridharan told reporters at a virtual press conference.

“The acquisition of DHFL fits perfectly into our overall retail strategy,” he said.

Earlier this week, the Competition Commission of India gave its nod to the acquisition of DHFL by PCHFL. Sridharan did not give a timeline for the expected approval from the National Company Law Tribunal but said the process is going as per expectations.

The Reserve Bank of India had in February this year approved the resolution plan for DHFL submitted by the Piramal Group.

Expansion plans

Meanwhile, elaborating on plans for Piramal Retail Finance, Sridharan said it aims to be one of the top five non-bank retail lenders over the next five years.

On Thursday, it announced the launch of its expanded multi-product retail financing platform. It is targeting ₹3,000 crore of new loan originations organically in next 12 months, in addition to inorganic growth.

Sridharan said the company, which plans to launch four more products this fiscal, is also looking at two wheeler financing and education financing in the next 12 months.

“We are working on a loans-against-shares product as well. We will also grow unsecured and multi-collateral lending products for small businesses,” he said.

At present, Piramal Retail offers seven products in its target markets –affordable housing loans, mass affluent housing loans, loans against property, secured small business loans, purchase finance, unsecured loans, and used-car loans. It is also looking to expand to 10 more locations in the next three months over the 40 locations it is already present in.

Published on April 15, 2021

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