Bandhan Bank changes strategy to focus more on retail lending


Bandhan Bank, a bank based out of Kolkata, has decided to change its strategy to focus more on retail lending rather than to corporates.

The bank, which procured a banking license in 2014, has switched its business strategy to emphasise more on financially excluded segments, i.e., the poorer sections of the society.

Chief Executive Officer, Chandra Shekhar Ghosh,  shared his thoughts on the shift with Economic Times, and said: “Most banks offer loans to only 10 per cent of the population and are fighting for that segment. We are targeting those who are left.”

Bandhan Bank started back in 2001 as a microfinance company and has been a constant player in the corporate lending sphere. “There is a need to build up skills so that bankers can understand the credit need of this segment, identify right proposals, the amount to disburse, and even repayment,” the CEO said.

Currently, 91% of the bank’s lending portfolio is dependent on micro credit with over 58% of its banks spread across rural areas.

Mr.Ghosh further said that the company will play to its strengths and will focus more on the retail lending sector by leveraging its experience in running a microfinance business.

The bank has opened over 805 branches around the country over the last one and a half year and has worked towards offering door-to-door services as well.

“The infrastructure in these 2,427 service centres is very simple and the staff is also simply dressed. The idea is to ensure that customers are not intimidated and we can understand and service their financial needs,” the magnate stated.

Speaking further on the effects of demonetizationBandhan Bank to focus on retail banking, Mr.Ghosh said that his company hasn’t been affected by Prime Minister Narendra Modi’s surgical strike on black money and suggested that low-cost credits will labour on.

The lending firm has no plans to enlist in stock exchanges and will plan the move once it has served three years as a service, as per Reserve Bank of India mandate.


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