India’s most valuable private lender, HDFC Bank, announced on Sunday that it plans to double its reach in rural areas over the next two years while building its leadership in MSME banking. The bank aims to expand its services to 2 lakh villages from the current 1 lakh villages over the next 1824 months. It plans to expand through a combination of branch network, business correspondents, trade facilitators, CSC partners, virtual relationship management and digital reach platforms, according to a statement. This will increase the rural reach of the bank to about a third of Indian villages.
To achieve its rural expansion goal, HDFC Bank would like to hire 2,500 employees over the next six months. “Rural and semi-urban markets in India are under-supplied in terms of loans. They offer long-term sustainable growth opportunities for the Indian banking system. HDFC Bank remains committed to serving the nation responsibly. We dream of being accessible with any PIN code in the future, ”said Rahul Shukla, Group Head – Rural and Commercial Banking, HDFC Bank.
HDFC Bank, which claims to be the second largest lender for the MSMEs segment in India, offers its services to MSMEs in more than 550 districts across the country. It already offers tailored offerings such as pre- and post-harvest crop loans, vehicle and two-wheeler loans, gold jewelry loans, and other select loan products in regions with and without bank details. According to a statement from March this year, the bank saw its loan book for MSMEs grow by 30 percent from December 2019 to 2020, to pre-Covid levels. It is also among the top banks in terms of loans under the ECLGS program, which was around Rs. 23,000 crore as of December 31, 2020.
Earlier this month, HDFC Bank signed a memorandum of understanding with the National Small Industries Corporation (NSIC) to offer credit support to MSMEs. The bank accepts loan applications submitted by NSIC and is considering sanctioning loans based on performance and in accordance with the bank’s credit standards. It also examines financing projects related to the MSMEs sector in various bank branches or other major industrial centers in the country. Similarly, HDFC Bank, in association with the Special Purpose Vehicle Common Services Center (CSC SPV), had established an overdraft line of Rs 50,000 Rs 10 lakh in July for small retailers who had been in business for at minus three years by using a six-month bank Provided a bank statement from any bank.
