Magma Fincorp starts using a simple analytics tool that has helped the company become an analytics driven organization:
Manoj K Mishra
Magma Fincorp in its dual role of an NBFC and an asset finance company, offers a diversified product portfolio: loans for cars, vehicles and commercial vehicles, construction equipment, tractors, SME businesses, mortgage finance as well as housing finance. It also offers general insurance products; Magma HDI General Insurance Company, is a joint venture with HDI Gerling. The company has has a dedicated base of around 5 lakh plus active customers and manages a loan book of Rs 18,521 crore through its 223 branches in 22 states and 9,200 employees. It has a rural and semi-urban focus and is present in 1,900 talukas and 2900 locations.
With regard to its consumer loans business, the company faced two unique challenges. Since it was lending to small merchants, farmers and daily wage workers, it observed that these customers are not consistent in repayment. This is because they do not earn a regular fixed monthly income like the salaried worker. So the first challenge was to align collections with customer cashflows. The second challenge was to maximise the productivity of the channel, a country-wide network of DSAs.
Says Manoj K Mishra, vice president – for technology at the company: “The challenge for us was 2-fold: from a customer acquisition perspective and establishing credibility of our customers and our extended hub that includes channel partners and DSAs.”
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