Vishakha Mulye, who took over as CEO of Aditya Birla Capital in July last year, sees a significant potential opportunity in the massive Micro, Small and Medium Enterprises (MSME) segment, where she believes loan penetration is still fairly low.
Noting that MSMEs contribute up to 30% of GDP, the former Group CFO and executive director of ICICI Bank stated that there is a need to raise awareness and improve access in order to leverage on the opportunity.
“MSMEs account for up to 30% of GDP, but credit penetration is extremely low.” What we need is increased MSMEs knowledge and access… “There is a large opportunity in the market,” Mulye remarked electronically to the media on Wednesday.
In March, the company introduced Udyog Plus, a comprehensive digital platform for SMEs. The platform provides a frictionless digital path for business loans and loan distribution of up to Rs 10 lakh.
Aditya Birla Capital
Furthermore, the platform has been integrated with government ecommerce websites via the Open Credit Enablement Network, as well as private ecommerce websites, to provide credit to sellers on these platforms.[ Since its introduction, the portal has attracted roughly 5,000 registrations, according to Mulye.
Meanwhile, she said that, while there were reasons for the low penetration level in the MSME segment, many of the issues have subsided as the segment has become more institutionalised.
On a different note, she stated that while Aditya Birla Finance – a wholly-owned subsidiary of Aditya Birla Capital (ABCL) – believes that maintaining the strong loan growth experienced in FY23 will be tough, the company is hopeful of healthy growth due to market prospects.
In FY23, the company’s book increased by 46 percent to Rs 80,556 crore.
“46 (percentage) is a large number; it is very difficult to keep that up.” As I previously stated, we have established scale and size in our organisation and believe the market potential is enormous. “We’ve put all the building blocks in place, so I don’t see why we shouldn’t continue to grow robustly,” Mulye added.
“Over the last year, our NBFC has grown and outperformed the market.” On the financing side, I anticipate a solid market. So, certainly, it will be a valid assumption to make,” she continued.