In an interaction with HP Singh, Chairman and Managing Director, Satin Creditcare Network Ltd

We are also actively investing in our in-house technology along with upgrading our forums & formats to achieve better services, lower operating costs, and higher efficiency; expresses HP Singh, Chairman and Managing Director, Satin Creditcare Network Ltd

What is your outlook on the Indian microfinance sector? What are the emerging trends that you are witnessing among borrowers in the rural markets post-pandemic? 

The Indian microfinance sector has been growing exponentially in the past couple of decades. Not only has it grown in credit lending but it also expanded in terms of the number of institutions. It has greatly contributed to financially empowering people, who are excluded by the formal economic system and helped in enhancing the standard of living of the people below the poverty line. The microfinance sector is now an integral part of the development of India/now plays an integral part in the development of India and serves as a beacon of hope for a lot of civilians in the rural as well as semi-urban areas.  
The pandemic caused major disruptions in the microfinance sector. It reduced the efficiency of loan collection and affected loan disbursements. However, since the lockdown has been lifted, a paradigm shift is seen in the way people perceive microfinance institutions (MFI). The MFI went above and beyond to create a client-centric approach throughout the pandemic. This led to a deeper sense of trust from the clients in the microfinance sector. Since the pandemic was a dreadful time for a lot of people, we observed more & more people turning towards MFIs for loans to start businesses and gain back some stability that was lost during the pandemic. The pandemic has helped strengthen the microfinance sector and bring it to the limelight so that more and more people are aware of solutions to their financial problems. 

For FY22, Satin Creditcare Network reported a PAT of Rs 21 crore as compared to a loss of Rs 14 crore in FY21. What factors have contributed the most to help you chart a stellar turnaround in performance?  

The pandemic hit the world in 2020, ensuing lockdowns around the world. It was a tough time for the microfinance sector. Many of our customers lost their livelihood. The loan repayments went down and so did the load disbursements. However, we at Satin Credicare Network Ltd (SCNL) continued believing in a customer-centric approach to deal with the challenges. We changed various structures and introduced different forms of loan repayment methods. We searched & implemented better ways to continue running the business and helping the rural people have financial backing. Additionally, as the lockdown got lifted, there was a rise in demand for credit by the people below the poverty line as they tried to get back their lives and searched for jobs or financial support to support their livelihood. All of this contributed to our FY22 comeback in terms of PAT. 

What are your key growth levers? 

We, at SCNL, are committed to growing our business and empowering the rural communities of India. As we walk into the post-pandemic era, we have placed our focus on growing our business so that we can make our services accessible to more people. There are certain growth levers that we are focussed on to expand our business and offices. We are acquiring new customers and developing strategies to expand our geographic presence. We are also working to ensure our retention rates remain high. The new RBI regulations are a big game-changer, as now, the interest rate margin cap has been done away with, enabling us to factor risk pricing in our loan products. 

At the moment, what are your top three strategic objectives? 

As the lockdown has lifted and we have been able to resume running our business as per the new normal, we wanted to be more proactive in the adoption of technology. Amidst the pandemic, we realised the significance the digital format carries and that the world is moving towards it. Although our client portfolio doesn’t allow us to fully switch to a digital model, we want to actively expand our digital platform. We have already launched various digital platforms for the repayment of loans during the pandemic but we want to explore more to create a seamless experience for our clients as well as for us. We are also actively investing in our in-house technology along with upgrading our forums & formats to achieve better services, lower operating costs, and higher efficiency. 

Apart from this, we are also focussing on growing our current loan portfolio. We are constantly reaching out to more people in the areas we are located. We want to help empower the rural communities so that they can grow to build self-sustaining businesses and develop a better standard of living. We are constantly training our field staff to improve our loan portfolio, get better retention rates, and enhance client satisfaction. 

However, we are not limiting ourselves to that. We are very strategic about where we are diversifying while one of our focus areas is being more accessible to low-income women micro-entrepreneurs. We want to strengthen these women by supporting them and providing credit so that they can grow their businesses and build a sustainable life for themselves as well as for their families. 

Apart from a microfinance portfolio, we also provide loans to micro, medium, and small businesses. In the affordable housing segment, we provide loans through our subsidiaries, which are showing good growth. This foray into segments was in line with the company’s strategy of leveraging our outreach and diversifying from unsecured to secure lending.