Bandhan to be ready with 600 branches before banking debut

The Kolkata-based Bandhan, one of the two firms (other being IDFC) to get the RBI nod earlier this financial year to start banking operations, is planning to launch its bank before the next festive season in 2015. In order to make a big impact ahead of the start of its full-fledged lending business, the micro finance firm is already in a frenzy setting up branches, all of which would be opened at one go.

"We would be launching the bank by September next. And it has to be an impactful affair. There is no other option," Chandra Shekhar Ghosh, founder of Bandhan micro-finance, told dna about the proposed start of the bank.
Along side the high-impact inauguration of the bank, Bandhan is also simultaneously looking to open 600 branches all at one go.

"We plan to start off with 600 branches at one go to make the necessary impact," Ghosh said on the sidelines of CII Banking Colloquium in Kolkata.

"It's like making a ship. You have to build the whole of it in the dry dock and then sail it. A ship can't be build in bits and pieces in water," Ghosh said.

There is also a compelling reason for opening all the branches before the formal start of the banking operations.

Following the launch of its bank, the 58 lakh existing micro-finance customers will be transferred from the micro-finance outfit to the new bank.

And all of its customers would be provided with banking infrastructure.

As of August end, Bandhan has over 58.16 lakh borrowers spread across 22 states serviced through 2,016 branches generating a loan book outstanding of Rs 6,446 crore.

Ghosh is hopeful of completing setting up of the branch network on time.

"We had started hunting for premises through a special team we had set up even before we got the banking licence. So, we are hopeful of completing the process in time."

Even as Ghosh plans for a big launch, he is counting every paisa that he spends.

To, illustrate, Bandhan hasn't spent on a headhunter despite being faced with the challenge of recruiting a full-fledged bank.

"Appointing a headhunter would have cost me much in terms of commissions paid to them against each recruitment. Instead I chose to advertise on newspapers and got 35,000 applications, " he said.

Bandhan, however, appointed Aon Hewitt, a human resource consultant to design compensation and benefit levels.