Seasonal demand for credit is set to surge: CEO of Au Small Finance Bank


Au small finance bank is a non-deposit-taking, non-banking financing company (NBFC) that was founded by Mr. Sanjay Agarwal in Jaipur in 1996. For over two decades, they have offered consumers secured funding, primarily in the Vehicle Loan, Business Loan, and Housing Loan categories. 

The lender has operated effectively to support economic growth, particularly for the underserved and unserved low and middle-class people.

Au Small finance bank proudly becomes a Scheduled Commercial Bank and a Fortune India 500 Company that offers a seamless banking experience through various industry-first initiatives. AU Bank is transforming to a digitally-led bank with a pan-India presence as a retail-focused bank that is constantly innovating to make banking easier for its customers.

From June 2020 until March 2021, Au Small Finance Bank’s recovery was robust but was hampered in April and May 2021 by the second wave of COVID-19. But with the arrival of the festive season, the lender expects credit demand to increase in the coming quarters.

The lender also expects its recovery rate to continue above 100%, as measured by collection efficiency.

Sanjay Agarwal, Managing Director and CEO of Au Small Finance bank said “Credit demand (at present) is not up to the mark because we are still coming out of that (COVID) phase and I believe that the festive season should give us a lot of energy and boost.” 

As the Capex cycle is about to begin, Mr. Sanjay Agarwal added the long-term prospects look quite promising.

“We are seeing green shoots in the corporate cycle and the SME segment,” Agarwal said.

According to the bank, the collection efficiency in June 2021 was 114%, and it was 101% in the first quarter of FY22. Mr. Agarwal also added that during July, collections were at 107-108%.

The bank made a profit after tax of Rs 203 crore in the quarter ended June 2022, compared to Rs 201 crore in the same quarter of FY2021. Gross non-performing assets (GNPAs) stood at 4.3 percent in the April-June quarter of FY2022.

On Wednesday, Au Small Finance Bank inaugurated its digital banking platform, AU 0101, as well as its credit card.

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