Among vehicle financing, two-wheelers financing is the largest for the NBFC and accounts for 38-40% of its asset under management worth Rs 7,000 crore
TVS Credit Services, a part of $7 billion TVS Group, is working on a roadmap to cater to the small and medium enterprise segment.
According to TVS Credit chief strategy officer Rammohan S, the entire roadmap may take three-six months to be ready. "By end of this year, we will launch it," he said.
Rammohan said the opportunities are huge, given a lot of its existing customers are self-employed. While large and medium SMEs have easy access to corporate funding, the same isn't true for smaller SMEs where certain products or customers' profiles find difficulty in getting credit.
"The market is under-catered and under-penetrated. And, that's the kind of opportunity we are looking at," he said.
As part of its roadmap, around 3-4 industrial clusters have been identified though Rammohan refused to divulge details, saying it is still early to talk about it. For the ticket size, too, he refused to comment further.
The non-banking financial company currently offers vehicle financing and credit for consumer durables, which was started only six months ago, and around 60% of its customers are first-time buyers. Among vehicle financing, two-wheelers financing is the largest for the non-banking financial company (NBFC) and accounts for 38-40% of its asset under management worth Rs 7,000 crore.
Recently, the Chennai-based NBFC has partnered with Mumbai-based meta-accelerator Zone Startups India, a joint venture between Toronto-based Ryerson Futures Inc and BSE Institute, to launch a year-long multi-format start-up engagement program to work with fintech and enterprise tech start-ups.
Zone Startups India, which has around 162 start-ups in its portfolio, is partially funded by the Department of Science and Technology.
As part of the programme, TVS will engage with start-ups who are working in areas such as underwriting, collections, people management, customer/ dealer management, new product development, operations and robotic process automation.
Rammohan said that many of TVS' customers do not have a credit history and are self-employed with no supporting documents. In the past one year, the NBFC has engaged with a few start-ups who made it easier for the NBFC to offer credit to these people.
"The advantage of working with start-ups is that their solutions are unconventional and disruptive. Most of the start-ups we are working on are integrating into the core business," he added.
He hopes to work with 12-15 startups under this programme, which would provide solutions and once they are validated, TVS will go into a fee-based commercial agreement with these startups. It has entered into a similar partnership with US-based network startup accelerator Plug and Play Tech Centre to tap into the global ecosystem. This partnership would provide solutions in areas such as customer servicing, process automation and artificial intelligence in Silicon Valley and Singapore.
Rammohan said it is looking to collaborate with the similar number of start-ups in Silicon Valley and Singapore as in India. It may look at a strategic investment or acquiring any of the start-ups In India and abroad if such a requirement arises in the future.
IN NEW LANE
- 38-40% is two-wheelers financing
- Rs 7,000 cr worth asset under management
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