Ravi Lalwani: What has been the business growth in MSME lending of the company over the last 3 years?
Abhishek Sinha: Over the past year, Capri Global Capital Ltd (CGCL) has strengthened its MSME lending portfolio with a well-diversified presence across key regions. Our Assets Under Management (AUM) in the MSME segment have grown steadily – from Rs33 billion in FY22 to Rs43.6 billion in FY23, and further to Rs50.1 billion in FY24. Our MSME loans comprise approx 24% of AUM and we expect it to grow at 20-25% CAGR.
The average ticket size for disbursals stands at Rs2.2 million in Q3FY25, reflecting our commitment to cater to the evolving credit needs of small businesses. The number of live accounts is 30,000+ in Q3FY25, demonstrating consistent demand and a strong borrower base. Our LTV for MSME disbursals has remained healthy, averaging around 54.5% over the past 5 quarters, ensuring a prudent risk framework while enabling access to finance.
Geographically, our MSME portfolio is well-diversified, with a strong presence in key high-growth markets across North and West India. Our deep market penetration and balanced expansion approach ensures wider financial inclusion while maintaining portfolio stability. As we move forward, our focus remains on scaling our MSME portfolio through customized lending solutions, leveraging digital integration for seamless credit access, and reinforcing financial inclusion across underserved regions.
Please share the top 3 regions, top 3 products, and top 3 industry sectors.
Our lending portfolio is strategically diversified across high-growth regions, tailored financial products, and key industry sectors, ensuring broad-based financial inclusion. Rajasthan, Gujarat and Madhya Pradesh have emerged as our strongest markets, reflecting robust demand for credit across various segments. Our diverse loans product suite caters to customer needs empowering entrepreneurs, businesses, and individuals to achieve their financial goals. Additionally, our lending book spans key industry sectors, with a strong presence in manufacturing, trading, and services, supporting businesses in scaling operations and driving growth.
Briefly describe the most impactful improvements that have been made for MSME customers during appraisal, onboarding, and ongoing servicing?
We have significantly enhanced the MSME customer experience by leveraging advanced digital systems that streamline processes, reduce turn-around times, and improve accessibility. Our digital-first approach ensures a seamless journey for customers, minimizing effort while maximizing efficiency. To simplify KYC verification, we have integrated Aadhaar-based OTP authentication, eliminating paperwork and accelerating approvals. Account Aggregator services enable us to securely retrieve banking data, reducing reliance on physical documentation and expediting credit assessments. E-sign services has transformed loan agreement execution, allowing borrowers and co-borrowers to sign digitally, ensuring quicker processing with enhanced security and convenience. Further enhancing customer engagement, the Capri Loans mobile application provides real-time access to loan details, promoting transparency and easy loan management.
Briefly describe improvements made to reduce NPAs of MSME borrowers and improve recovery from defaulters.
To strengthen MSME portfolio health and enhance recovery, we have integrated cutting-edge AI-driven technology to optimize early-stage delinquency management. Our in-house AI-based system improves productivity by identifying risk patterns early and enabling proactive interventions.
By implementing an Early Warning Signal (EWS) framework, we have introduced multiple engagement channels to connect with delinquent borrowers, mitigating the risk of further slippages into NPAs. This has led to improved normalization rates and rollbacks, effectively curbing NPA growth. On-ground efforts have been intensified with an advanced tracking mechanism, ensuring greater field efficiency and deeper customer outreach. These measures have strengthened recovery efforts, improved flow rate control, and reinforced financial discipline within the MSME segment.
Who are your key technology and fintech partners in MSME lending? What solutions have they provided to CGCL?
To enhance data-driven decision-making, we leverage CAMS for Account Aggregator services, enabling secure and efficient access to customer banking information. Additionally, Novel Patterns supports our bank statement analysis, providing deep financial insights that strengthen our underwriting process. For loan disbursement and end-to-end customer lifecycle management, we rely on Oracle Flexcube LMS, a scalable and reliable platform that streamlines operations and enhances service efficiency.
Briefly describe in-house developed applications for MSME lending, and how they have been modernized in terms of functionality, technology, data sources, etc.
We are at the forefront of technology-driven lending, continuously modernizing our in-house platforms to enhance customer experience and operational efficiency. We have developed proprietary applications to enhance our lending operations, focusing on modernization across functionality, technology, and data integration. Our in-house sales mobility platform and loan origination system (LOS) have been upgraded to streamline the lending process, offering a seamless experience from application to disbursal. These platforms now incorporate advanced data analytics and integrate with external data sources, enabling more accurate credit assessments and personalized loan offerings. These technological advancements have significantly improved operational efficiency, reduced turnaround times, and enhanced customer satisfaction.