Karnataka Bank Ltd. (KBL), a Mangaluru-headquartered financial institution that is turning 100 in February this year, said it would focus on three key factors to further expand market reach and unlock its next level of growth.
These key factors are the bank’s extensive branch networks across the country and its employees, a bouquet of products driven by technology and digital accessibility and transactions and external collaborations with domain experts across diverse spaces.
“We have chosen to grow on three fronts in our centenary year. One of course is focusing on organic growth, growing on the strength of our assets, our network of branches and people; leveraging our vast product culture and do what we can’t do through collaborations,’‘ said Srikrishnan H., Managing Director & CEO, Karnataka Bank.
He said at 100, the bank was starting up all over again with more eagerness to reach out and support newer sections of people and entrepreneurs. To sharpen its focus and also to strengthen its tech/digital delivery side, the bank has deployed a Chief Product Officer and a Digital Officer, in addition to setting up centres of excellence for digital and analytics.
Mr. Srikrishnan further said, “We are rightly positioned for quantum growth. The last quarters have seen our overall loan business growing very aggressively and the pace will continue. We are a start-up at 100, we are thinking entrepreneurial, acting entrepreneurial and entering into partnerships with entrepreneurs,’‘
Apart from having an intensive reach in the home state, Karnataka Bank has 50 branches each Maharashtra, Telangana, Andra Pradesh and Tamil Nadu. It also has a significant presence in Delhi/NCR region, Gujarat, Punjab, Mandya Pradesh, Utter Pradesh (opened a branch in Ayoda last week) and in the east and western parts of the country.
Karnataka Bank and Clix Capital, a new-age NBFC, on Tuesday, entered into a strategic co-lending partnership through Yubi Co.lend platform. This partnership is focused on providing loans to the MSME sector that comprises over 6 crore enterprises which cumulatively contributes 40% to the country’s GDP and employs over 12 crore people, according to Clix Capital.
Rakesh Kaul, CEO, Clix Capital said, “With this partnership, we will bring to the table our tech prowess, and agility to understand and underwrite segments that largely remain underserved.’‘
Earlier, announcing the partnership in a media conference in Bengaluru, Mr. Srikrishnan said, KBL’s co-lending partnership with Clix Capital would offer digital credit thereby offering much-needed liquidity to entrepreneurs at affordable rates.
Mr. Kaul further said the target was to offer loans to the tune of ₹50 crore a month to MSMEs to start with and grow it to ₹100 crore a month later, to achieve a total disbursement of ₹500 crore by March 2025.
Responding to a query on revenue sharing he said, “It will be an 80:20 share; 80% of the loans facilitated under this partnership will reflect in the books of Karnataka Bank while the remaining 20% will go into the balance sheet of Clix Capital.’‘
Quoting various reports Mr. Kaul said, the MSME credit gap was currently in the range of ₹350 billion and $0.50 trillion, indicating a huge appetite for capital in the sector. He also said the segment’s fund requirements were also increasing as as focus on sustainability was also on the rise.
