Ajivika Finance is diversifying from micro-enterprises to include funding for start-ups, SMEs, and business loans:
Ajivika Finance specializes in delivering vital micro-credits to low-income households, which are unserved by traditional banks. Under the leadership of Kamal Dang, Managing Director, AFL has undergone a remarkable transformation, expanding its loan offerings to include SMEs, start-ups, and business loans.
With a focus on rigorous due diligence and KYC processes, AFL operates a profitable branch network model, ensuring cost-effective and scalable operations. Committed to financial inclusion, the company aims to serve 1 million households by 2025, promoting social empowerment and economic growth.
Recent Initiatives
The company has experienced significant changes in the past year. Says Kamal: “In the last 12 months, the management has changed the entire operation of the organization, which was earlier completely physical, to paperless i.e. digital, through technology. This has brought about a considerable improvement in the efficiency of the team.”
Key Achievements
One of the most notable achievements for the company in the last year has been the diversification of its loan offerings. Previously, it focused solely on providing loans to micro-enterprises. Now, it has expanded to include funding for start-ups, SMEs, and business loans. This strategic move has elevated the company’s portfolio and broadened its operational scope. Kamal adds: “This has enabled the company to take its portfolio to a higher level of its operations.”
Ajivika Finance has over 42,600 cumulative clients, with more than 6000 active clients. The company was founded on May 28, 1986 and operates in Uttar Pradesh, including the cities of Ghaziabad, Modinagar, Hapur, and Jansath. It has a total of 9 branches.
Looking ahead, the management has ambitious plans for the future. Says Kamal: “In the next 3 years, the management expects to increase its portfolio by 100% per year for which the team is working hard.”
Sources of Debt and Equity
In the past 3 years, the company has successfully met the capital-raising targets set by the Reserve Bank of India for 2025 using internal sources. The next target, set for 2027, is expected to be achieved by 2025. It has also secured loans from previous financiers, enabling it to meet these ambitious targets.
Changes in Top Management
Kamal notes: “In the last 24 months, the company’s stakeholders have made substantial alterations in the top management of the organization, which has brought about an unprecedented change in the team’s performance.”
The company’s stakeholders decided to replace a manager with a boss-centric work culture with a new leader who embodies a more collaborative and empowering approach. This strategic shift has effectively ended the previous authoritarian culture and introduced a leadership style that inspires and motivates the entire team.
Technology & HR Initiatives
The company has made substantial strides in technology. The entire operations are now conducted digitally, a major achievement that has streamlined processes and improved overall efficiency.
In terms of HR initiatives, managers have been given independent responsibility for their departments, with a second layer of management created beneath them. This structure has significantly enhanced team efficiency. Additionally, efforts have been made to help the team maintain a healthy work-life balance, reducing stress and improving productivity.
Financial Performance
Here are the financial figures for the company over the last 2 years (in Rs million)
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