Indusind Bank Ltd. · NSE:INDUSINDBK
Indusind Bank — Investor Day (July 2022)
38 slides from Indusind Bank's investor day presentation, Jul 27, 2022
Slide 1: Analyst Day
– Analyst Day 27th July 2022
Slide 2: IndusInd Bank – Analyst Day: Microfinance/BFIL
IndusInd Bank – Analyst Day Presentation-3 Microfinance/BFIL
Slide 3: Introducing Bharat Financial Inclusion
Introducing Bharat Financial Inclusion • Founded in 1997, over 24 years experience in serving the underserved • Started as an NGO, we evolved into an NBFC and later became a part of IndusInd Bank in 2019 • We provide micro-loans and banking services to bottom-of-the-pyramid segment to help them impr
Slide 4: We serve customers with high aspiration though low on literacy and moderate on tech quotient
We serve customers with high aspiration though low on literacy and moderate on tech quotient Profile of Our Customers • Rural women entrepreneurs and nano-retailers high on aspiration though low on literacy levels • Largely bottom-of-the-pyramid segment. • We are the only financier for 56% of our cu
Slide 5: Highly phygital customer journey
Highly phygital customer journey Customer base that requires assisted banking services Physical Sourcing Phygital On-Boarding Phygital Servicing Physical sourcing of customers Assisted on-boarding by Customers are serviced Phygitally. given the understanding of feet-on-street given the low Approxima
Slide 6: Highly phygital customer journey: BFIL's unique capabilities
Highly phygital customer journey BFIL’s unique capabilities to serve this customer base A AGILITY - Agile and flexible operations that can serve the last mile customer at their door-step C COST EFFICIENT OPERATIONS - One of the most cost-efficient operator in the industry E EXECUTION CAPABILITY - Ca
Slide 7: Microfinance
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 8: High customer connect
High customer connect Village Weekly Survey center/ Meetings/ Projection Peer FUL/ Banking Meeting Group • Exclusive women borrowers Product • Group selects members and underwrites loan Lending • Progressive loans - Ticket Size increases with customer vintage Weekly CGT Asset & Install. Liability •
Slide 9: High customer connect: Center Meeting (Distribution Channel)
High customer connect Center Meeting (Distribution Channel) High Engagement Center meeting days 40 mins Avg. Center meeting; Monday to Friday Attendance compulsory Financial services - Doorstep Delivery Microloans, Consumer Durable loans & deposits
Slide 10: Sustained growth amidst macro shocks
Sustained growth amidst macro shocks 12% 90% 84% 11% BFIL Marketshare (%) BFIL Growth (%) Industry Growth (%) 10% 10% 80% 10% 9% 9% 9% 9% 70% 8% 7% 60% 47% 46% 45% 50% 6% 38% 38% 40% 32% 29% 4% 27% 26% 30% 19% 29% 19% 20% 2% 11% 10% 10% 9% 0% 0% FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Kerala floods
Slide 11: Sustained growth amidst macro shocks
Sustained growth amidst macro shocks Loan Book (₹ Bn) Borrowers (in Mn) 8% 298 CAGR 7.3 25% CAGR 4.6 77 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Branches (#) Loan Officers (#) 2,422 17,094 18% 13% CAGR CAGR 1,146 6,243 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY16 FY17 FY18 FY
Slide 12: Bharat Super Shop
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 13: Giving wings to nano retailers – ~550,000 retailers across 300 towns
Giving wings to nano retailers – ~550,000 retailers across 300 towns Retailers mix Others We lend to 38 identified trades • Meat Shop, 3% • Dairy Parlour, 2% • Bakery, 2% • Footwear Store, 2% Opportunity Nano retailers who have no access to institutional credit • Electrical Shop, 2% * Other activiti
Slide 14: Giving wings to nano retailers – ~550,000 retailers across 300 towns
Giving wings to nano retailers – ~550,000 retailers across 300 towns We lend to micro-retailers in Tier II & Tier III cities (300+) Medical Store Tailoring Shop Kirana Store Fancy Store Garment Retailer Footwear Retailer
Slide 15: Scaling up FY2020 – FY2022
Scaling up FY2020 – FY2022 Scale FY2022 Stable Credit costs • Locations 306 | Branches 382 • 99% paying customers • Retailers - ~5.5 lakh | Active Borrowers 3.2 lakh • 0.6% GNPA • No. of loans disbursed 6.2 lakh | Amount disbursed Rs. 3,252 cr. • Managed Covid events with <1.5% credit cost • Advance
Slide 16: Bharat Money Store
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 17: Solving the last mile question
Solving the last mile question 5 - 8 Kms & invests upto 2 hours for cash deposit and withdrawal at Bank / ATM 2 - 5 kms, spending upto 1 hour for electricity bill payment 1 - 5 kms to Municipality office for water bill payment spending up to 30 minutes Travels 1 - 5 km and spending up to 30 minutes
Slide 18: BMS 1.0 since 2017
BMS 1.0 since 2017 FY18 FY19 FY20 FY21 FY22 Enrolled Merchants: Enrolled BMS Enrolled BMS Enrolled BMS Enrolled BMS 244 Merchants: 1,376 Merchants: 23,286 Merchants: 51,379 Merchants: 86,027 Active BMS: 156 Active BMS: 1,070 Active BMS: 13,953 Active BMS: 23,600 Active BMS: 46,976 Transaction value
Slide 19: BMS 2.0 – Strong rural branding focus
BMS 2.0 – Strong rural branding focus Flanges & Standee at the main entrance
Slide 20: BMS 2.0 – Strong rural branding focus
BMS 2.0 – Strong rural branding focus Posters on the glass
Slide 21: IndusInd Bank's rural touch points, highly visible
IndusInd Bank’s rural touch points, highly visible BHARAT MONEY STORE BMS 1.0 BMS 2.0 Current Account Transactions Balances enhanced Deposit, Withdrawal, Current Account with QR code IMPS, Bill Payment Welcome Kit with Debit card IndusInd Bank Merchant Loan Branding sharper RD based 1st Cycle Loan,
Slide 22: A strong risk culture
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 23: A strong risk culture
A strong risk culture Credit Risk Operational Risk Stringent Credit norms in comparison to Industry to mitigate risk of unsecured lending JLG continues to mitigate risk for micro-credit Number of Other Lenders portfolio. Existing customer <=2 Savings & extended banking services to strength
Slide 24: Delinquency trend – BFIL vs. Industry
Delinquency trend – BFIL vs. Industry % BFIL0+DPD % Industry 0+DPD 21.7% 16.1% 15.0% 15.7% 11.3% 8.7% 7.2% 8.4% 6.3% 3.3% 2.7% 0.2% 1.3% 2.2% FY16 FY17 FY18 FY19 FY20 FY21 FY22 Kerala floods 2018 Demonetization Odisha Cyclone Covid-19 waves 1,2 & 3 Nov – Dec 2016 2018 -2019
Slide 25: BFIL has conservative ticket sizes
BFIL has conservative ticket sizes BFIL Industry Ticket Size Ticket Size Market Share Over ₹45,000 7% ₹72,101 ₹25,758 States Included: Andaman & Nicobar, Assam, Dadra & Nagar Haveli, Delhi, J&K, Meghalaya, Industry BFIL Mizoram, Nagaland, Sikkim, Tripura, West ₹47,811 Cr Bengal 93 ₹45,342 ₹19,174 Un
Slide 26: Agile Technology
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 27: Agile technology, capability to handle large volumes
Agile technology, capability to handle large volumes Lead Customer Underwriting Customer Product Rules Engine Generation Data Entry Workflow Creation Set up Core Levers EOD Loan/RD Disbursal Branch NPA Collection Loan Creation Processing Schedule Work Flow Sangam Manager Loan Officer EKYC KYC Verifi
Slide 28: Employer of Choice
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 29: Strong foundation of People – Culture - Performance
Strong foundation of People – Culture - Performance Very high degree of internal talent sourcing Employer of choice • For the field staff, talent is hired ONLY at the Sangam • Consistently ranked in Top 100 Great Places to work in India Manager (entry) Level. Internal talent development process for
Slide 30: Internal Audit
Internal Audit – Ensuring process controls
Slide 31: Internal Audit – Critical role in ensuring process control
Internal Audit – Critical role in ensuring process control • ISO 9001:2015 certified process • All branches are inspected monthly based on a 4-tier grading system • Communication of Audit Findings at all levels – Branch, Region and Senior Management Strength • Branch Grading linked to incentives/app
Slide 32: Member Helpline
BHARAT ~ Financial Inclusion Led ~—Prayaas se pragati ii \dusind Bank Limited _ IndusInd Bank
Slide 33: High customer connect – Member helpline evolving with times
High customer connect – Member helpline evolving with times Member calls MHL Helpline IVR in 8 vernacular languages Agent wishes the caller and takes brief on query / complaint / request • Enquiries Effective system in place to receive and resolve client • Resolutions Agents check details in CRM and
Slide 34: Towards becoming a Micro-banker
Towards becoming a Micro-banker
Slide 35: Towards becoming a Micro-banker from a Micro-lender
Towards becoming a Micro-banker from a Micro-lender RBI framework Near term growth strategy Wind under the wing Playing to strengths • Comprehensive Principle-based RBI regulations • Evolving from a micro-lender to a micro-banker announced in March 2022 offering a wider suite of products to meet evo
Slide 36: Leveraging BFIL's distribution to diversify offerings to Bharat
Leveraging BFIL’s distribution to diversify offerings to Bharat Building on BFIL’s deep rural distribution in Current Loan Book Bharat and acquiring new customers 6% Scaling up loans to nano retailers JLG Loans 94% Loans to Merchants Graduating women entrepreneurs from JLG Individual Loans based loa
Slide 37: Sambhav Hai!
(7 BHARAT % Financial Inclusion Ltd * Prayaas se pragati A 100% subsidiary of Indusind Bank Limited It’s possible! Indusind Bank IndusInd Bank
Slide 38: Disclaimer
Disclaimer This presentation has been prepared by IndusInd Bank Limited (the “Bank”) solely for information purposes, without regard to any specific objectives, financial situations or informational needs of any particular person. All information contained has been prepared solely by the Bank. No in