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In the second such deal in the last three months, Kotak Mahindra Bank has bought 99.49 per cent stake in Bengaluru-headquartered BSS Microfinance Pvt Ltd for ₹139.20 crore. In July, newly-started private sector bank IDFC Bank bought out Tamil Nadu-based Grama Vidiyal Micro Finance Ltd.
BSS Microfinance, a non-banking finance company, has a networth of about ₹73 crore and microfinance loans of ₹483 crore in its books, as of June 30. It will become a subsidiary of Kotak Mahindra Bank. This acquisition gives Kotak access to BSS Microfinance’s growing customer base, which now stands at 2.17 lakh and a network of 78 branches. It also gives Kotak a deeper reach into the low income segment and at the same time increases the access of BSS Microfinance’s customers to a wider array of banking products and services. BSS Microfinance’s loan book qualifies for priority sector lending.
The deal will help in increasing financial inclusion. Kotak believes the capabilities and processes required for this customer segment are different and cannot be created easily or organically in a short period of time.
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