AU Small Finance Bank’s ambitious growth plans

On April 1, AU Small Finance Bank (AU SFB) amalgamated with Fincare Small Finance Bank (Fincare SFB), keeping the first such merger in the sector.

Doubling Balance Sheet Size:

AU Small Finance Bank aims to double its balance sheet size to Rs 2.5 lakh crore within three years, leveraging factors such as the acquisition of Fincare SFB and the rising consumption trend in India.

Expansion Initiatives:

The bank has embarked on strategic initiatives to fuel growth, including obtaining an Authorised Dealer (AD-I) license for forex operations under ‘AU Remit’ and venturing into Cross-border Trade with ‘AU DigiTrade’.

Projected Growth:

With a target growth rate of 25% over the next three years, AU Small Finance Bank seeks to achieve substantial expansion, building on its current balance sheet size of over Rs 1.25 lakh crore and a branch network of 2,400 touchpoints.

Organizational Development:

The bank has witnessed remarkable growth in human resources, increasing from 3,000 to 46,000 employees since its inception in 2017, highlighting its commitment to scaling operations and serving a wider customer base.

Customer-centric Approach:

Emphasizing its commitment to customer service and satisfaction, AU Small Finance Bank aims to become a bank for generations, prioritizing customer needs and preferences.

Merger with Fincare SFB:

The recent amalgamation with Fincare Small Finance Bank, approved by the RBI, has significantly expanded AU SFB’s presence in South India, enhancing its distribution network and market position in the region.

Integration Focus:

The focus now shifts to ensuring a seamless integration within the next 9-12 months, with dedicated efforts to deliver exceptional banking services and value to customers. Both banks have established dedicated task forces to facilitate the integration process.

Financial Inclusion Drive:

AU Small Finance Bank’s merger with Fincare SFB marks a significant milestone in the financial inclusion journey, aimed at providing basic banking services to underserved segments such as small farmers, micro-businesses, and the unorganised sector.

Regulatory Landscape:

The merger between AU SFB and Fincare SFB is the first of its kind following the grant of licenses to set up Small Finance Banks by the RBI in 2015, signaling a new phase of consolidation and expansion in the banking sector.