Every individual should have access to financial services, says Sanjay Agarwal, CEO of AU Small Finance Bank
SANJAY AGARWAL, Managing Director and CEO of AU Small Finance Bank, talks about his journey from finance company to bank, and his primary mission of providing formal financing to unbanked Indians. He reiterates the ‘badlaav’ story amplified in the bank’s recent ad campaign and says his vision is to be a technology-driven bank.
Please take us through the journey of transforming AU Small Finance Bank from a finance company to a bank.
In 1996, AU was founded as a Non-Bank Financial Corporation (NBFC) that worked effectively on financing economic growth, especially for underserved and unserved lower and middle class people. In 2015, when RBI issued guidelines on licensing small fundraising banks, the AU was the largest entity among the top 10 shortlisted applicants, so we turned into a bank in April 2017. Today, AU is the largest small financial bank (in terms of total assets) and a listed entity with 25 years of experience as a retail-oriented, customer-centric institution. From the first year of launching our banking operations, we have grown into a regular commercial bank and a Fortune India 500 company. Now, we have established strong operations through over 758 banking contact points serving over 20 lakh clients in 15 States and two Union territories. During these years we have built a strong net worth of around Rs 6,490 crore, a strong deposit base of over Rs 37,000 + crore and a strong loan base of around Rs 36,000 + crore. Additionally, I am delighted to share that we are the first and only small financial bank to launch credit cards to date. To bring something new to the table, we started lending based on QR code transaction history, a first of its kind for any small fundraising bank. With the recent launch of our awesome AU 0101 app, we’ve made banking even easier. From now on, we offer home banking services with a video banking service, to the delight of our customers.
When the AU was founded two and a half decades ago, its main mission was to bring formal funding to the unbanked and to simplify banking operations for the average Indian. What are the basic strategies that you adopted then and that you are following now? How much of a challenge is that still today?
At AU, we’ve always believed in the challenge of the status quo. The first step was when we started a capital intensive business with very little funding available. While we were starting out as a bank, instead of moving to Mumbai or Bangalore as our base location, we dared to set foot in the banking world with Jaipur as our head office. Unlike other formal funding channels that did not view underserved and unaffected people as a safe bet, we started a business entirely focused on funding this category of people, making sure to maintain a high quality of service. active. We’ve brought value to our customers and made banking more convenient for them. The banking sector, the backbone of India’s fast-growing economy, will forge its way towards sustainable growth and development in the post-pandemic era. Our bank is well positioned to make the most of the opportunities that will arise in the future.
The message of your ‘Badlaav Humse Hai’ mega brand campaign is to challenge the status quo in banking. What kinds of changes have you set out to make to the Indian banking sector?
With each product and service, we try to push the existing standards and offer new pleasure to our customers. We offer monthly interest, compared to the quarterly interest standard; we really go paperless as we don’t require customers to fill out deposit or withdrawal slips and they can avail any service or product from any branch across the country without the branch limitation. ‘origin. We take pleasure in going further by doing small things “differently”. Digital banking is gaining ground and the ongoing pandemic has only accelerated this pace. As the industry’s first initiative, we’ve built an integrated video banking platform on top of our recently launched super app, AU 0101, which allows customers to open savings accounts and term deposits, perform financial transactions and help them with over 300 service requests available at the Bank. In fact, our customers can open a savings account on WhatsApp and access all deposit accounts on Tab. We have also provided an end-to-end digital journey for those looking for two-wheeler loans.
What do brand ambassadors Aamir Khan and Kiara Advani bring to your campaign? How will the campaign play out in reality? What are you planning?
Our “Badlaav Humse Hai” campaign is not the promise of a dream to make a dent in the banking category, but only a showcase of what is already being done every day through all its points of contact. The ‘badlaav’ is already in action. He just needed a showcase and a platform to communicate. To make the campaign impactful, we chose Aamir Khan and Kiara Advani as our brand ambassadors. Khan’s name is synonymous with challenging the status quo through the projects and films he associates with. It perfectly symbolizes the change that India has always aspired to and sometimes experienced – just like the AU brand. Advani has become one of the most popular Indian film actors and a youth icon in recent times. His professional choices and his recent repertoire of works find a perfect resonance with AU’s career so far. I think our brand ambassadors will help us reach out to the masses and tell them the “badlaav” story of AU Bank. We have planned a 360-degree marketing campaign, with each media playing a central role in generating brand indicators.
Considering that there is huge competition in the digital banking space with many established players, what will UA 0101’s USP be?
AU 0101 is a truly omnichannel and mobile platform that offers a complete payment suite and end-to-end customer journeys for savings accounts, term deposits, credit cards, auto loans, personal loans , insurance and investment products. It offers a host of lifestyle services, including mobile top-up, hotel reservation, and flight reservation, which are integrated with the customer’s AU bank account for payments. Customers can also take advantage of a multitude of our allied BFSI products such as insurance and MFs.
What are your plans for moving forward? Give us an idea of the quantum of your assets under management (AUM) and what are the objectives that you have set for yourself?
Our historic approach to assets – small ticket size, for revenue generation purposes and secure, risk-based pricing – has helped us emerge much stronger from this pandemic. Our performance and the behavior of our clients in these difficult times has given us the confidence to continue driving the growth of our assets by focusing on existing products – wheels, SBL, mortgage and commercial banking – and deepening the penetration into our customer segments and identified markets. We are building a liability franchise that is granular in nature and is led by retail – individuals and small businesses. We aspire to seize the opportunity offered by smartphone and internet penetration in India to provide banking services in a convenient and cost effective manner. and we are building like a technology-driven bank. We want to impart financial and digital literacy to bring our rural and semi-urban clients into the digital ecosystem.
Acting as an efficient intermediary, we collect deposits in urban markets (74% of our portfolio of liabilities come from the urban market) and disburse in our rural and semi-urban markets (66% of our portfolio of assets is loaned to this market). Our vision is to build a society where every individual has access to financial services by improving access, increasing use and improving quality through financial education.
“Do it now! the power of execution has been my guiding principle always, combined with attention to detail. It is through this approach that at the AU ordinary people come together to do extraordinary things, ”says Sanjay Agarwal.
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Posted on: Monday August 23, 2021 12:09 am IST