Internet connectivity is one of the biggest challenges facing the country’s youngest bank, Bandhan Bank Ltd, as it opens new branches across states, Chandra Sekhar Ghosh Founder, Managing Director and CEO said.
The bank completes a year of operations next week and has a presence in 50,000 villages through its 701 branches. “Currently, 33 per cent of our branches are in rural areas, some of which were un-banked ones,” he said in an interview. Poor Internet connectivity in the rural and semi -urban branches was one of the biggest hurdles in extending banking services since August 23, 2015, when the bank started operations.
Skill development for the employees was also another challenge. Bandhan is not only the first micro-financing institution to get a universal banking licence from the Reserve Bank of India, but it is also the first bank to be headquartered in Kolkata, since Independence.
Micro-credit customersAlthough the bank started with the advantage of its micro-credit customers migrating to the bank, it has acquired over 20 lakh additional customers with its total base now standing at over 89 lakhs. Bandhan’s deposit base now stands at around Rs.16,000 crore with a loan disbursal of Rs.16,500 crore. Aside from micro-credit, the bank’s loan portfolio is spread over the medium, small and micro-enterprises, retail loans and start-ups according to Mr. Ghosh.
The bank has so far not extended support to any large corporations. It recently opened an NRI branch at the upscale Park Street area in Kolkata. Mr. Ghosh expects business at this branch to pick up from the second half of this fiscal, when NRIs come to the city.
With a recovery rate of 99 per cent and a capital adequacy of 29 per cent, Bandhan’s journey so far has been good, according to its founder “There is money in the rural areas, which needs to be channelised,” he said. BBL closed 2015-16 with a Rs 275.3 crore profit.
