Transfer of the microfinance business to the proposed new bank is going to be a challenge, founder Chairman and Managing Director of Bandhan Financial Service Ltd. Chandra Sekhar Ghosh said a day after Reserve Bank of India named the institution as among the two entities that would get a provisional banking licence.
Once that task was accomplished, BFSPL, the non-banking finance company, would close down operations, Mr. Ghosh said adding that entry into banking services would allow the entity to offer additional services such as deposit mobilisation of money remittance.
Mr. Ghosh said the RBI had given 18 months time to start the banking operations. 'We are preparing towards that. The process has already started,' he said.
He said that there were no immediate capital needs for Bandhan, which has a capital base of Rs.1,100 crore. With equity financing by SIDBI and IFC, Bandhan was formed in 200. It started operations in 2002. Its total assets size is Rs.6,200 crore.
Total loan disbursal is Rs.9,100 crore with repayment of 99.5 per cent.
Out of the present 2,016 branches in 22 States, 70 per cent of the network was in rural areas, Mr. Ghosh said. Some of them would be restructured, he added..
At present, Bandhan is benefiting over 54 lakh borrowers at March-end, and has 13 lakh employees on its rolls.