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UTKARSH VOICE Q2 [FY 16 -17]: Volume-8, Issue-2
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Q2 FY 2016 -17 Highlights
The quarter was marked special with completion of 7 years of microfinance outreach of
the company (since Sep. 2009). The company has over 1.2 Mn active clients with over
₹17,700 Mn of portfolio outstanding as at the end of the quarter. The Delhi Regional Office,
comprising of Delhi NCR, Uttarakhand, Haryana and Himachal Pradesh crossed the
milestone of ₹200 crore portfolio during the quarter.
The microfinance outreach, the JLG active client base, was over 1.18 Mn with portfolio
outstanding of over ₹16,700 Mn, the MEL portfolio was ₹951.5 Mn with 16,816 active
clients and the Housing Loan pilot reached 122 active clients with ₹34.0 Mn portfolio
outstanding. The total portfolio of the Company was ₹17,740.7 Mn as on Sep. 30, 2016.
The Company has been adjudged with “Skoch Inclusive Insurance (Gold category) Award
2016”. The same has been adjudged for being amongst the ‘Top 100 Projects in India’ for
financial inclusion through insurance, covering and settlement for highest number of lives
and customer servicing during the year 2016.
Domestic Equity of ₹395 crore – For setting up the Utkarsh Small Finance Bank, reputed institutional investors - HDFC Standard Life Insurance Co. Ltd, HDFC Ergo General
Insurance Co. Ltd, ICICI Prudential Life Insurance Co. Ltd, Shriram Life Insurance Co. Ltd,
RBL Bank Ltd, Small Industries Development Bank of India (SIDBI) and private equity firms
like Faering Capital and Arpwood Capital have made equity investment. Post this
investment, the company is now a Domestic Company, which is an important eligibility
parameter for an SFB.
Constitution of the new Board for Utkarsh Small Finance Bank – Experienced and reputed personalities for the new Board of SFB:
i. Dr. V. S. Sampath, retired Chief Election Commissioner; 1973 batch IAS Officer ii. Mr. Tantra N. Thakur, retired MD & Chairman of Power Trading Corporation;
Member of Indian Audit and Accounts Service.
iii. Mr. Somnath Sengupta, ex-Executive Director of Axis Bank; 38 years of banking
experience.
iv. Ms. Anita Ramachandran, Founder and Director of Cerebrus Consulting, an HR and
Management Consulting firm; 37 years of management consulting experience.
v. Mr. Govind Singh, Director and MD & CEO (designate).
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Branding – To reach people with information on Utkarsh SFB and to establish the Utkarsh brand amongst them, public relation activities have already been initiated. The Company
has made suitable agreements with Focus 360o
Media Pvt. Ltd. for branding activities and
with Adfactors PR for public relations activities.
Banking Training of existing employees – More than 1,700 employees have already undergone Basic Banking Training. In the 2
nd
phase (Module II running simultaneously),
employees are now being made aware of the new products and processes. New software for Banking – The Company has partnered with Intellect Design Arena Ltd. as technology partner for the Banking Software. Most of the modules of the software are
ready and work is on for few other modules. AGS Transact Technologies Ltd. would be
the ATM and Payments Services partner.
Recruitment for banking operations expansion – For providing new services (deposit facilities, insurance, mutual funds, etc.) as well as for providing existing services in new
areas, suitable recruitments (especially for Middle and Senior Management) have largely
been done. In coming months, more recruitments shall be done, especially for the junior
managers and the executives.
Training agreement with National Institute of Banking and Finance (NIBF) – For recruitment & training for banking operations employees, the company has made agreement with NIBF, Raipur, Chhattisgarh. Specially selected candidates shall be joining
the company after completing the 4 months banking certification program from NIBF.
Under the Credit Plus initiatives, the company continued to take up its activities focused on Education (Financial Awareness), Health (Branches and also Mobile Poly Clinic vans)
and Goodwill gestures. Incrementally, the company launched the second set of Mobile
Van Poly Clinic through 5 more branches (now total 10); the new one’s being 5 in
Gorakhpur Division, Uttar Pradesh during Q2, FY 2016 – 17.
Along with all business activities, the quarter was marked special with new incumbents joining in the Senior Management. Mr. Haresh R Wadhwa, joined the company as Head - Operations, and Mr. Mohan Kumar Sahni as Business Head - Cards.
In recognition of the performance through Annual Performance Appraisal, the company
sent the 3rd
batch of 46 employees (representing operations and non-operations employee
from branches and administrative officers) for ‘Reward and Recognition Tour’ to Jaipur from July 09, 2016 to July 13, 2016 respectively.
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Grading –
ICRA has assigned an MFI grading of M1 (pronounced M one) to Utkarsh Micro Finance
Limited (UMFL). The grading indicates that in ICRA's current opinion, the MFI's ability to
manage its microfinance activities in a sustainable manner is the highest. The grading is
valid till July 2017.
The Strengths and Challenges highlighted in the report are:
Strengths Experienced and professional management team; strong investor profile.
Robust loan origination, risk management, internal audit and MIS systems leading
to healthy asset quality.
Comfortable capitalization indicators supported by regular capital infusion; foreign
shareholding likely to be lowered to meet SFB requirements.
Financial flexibility arising from diversified funding mix; need to deepen the liability
franchise on conversion to an SFB.
Healthy profitability indicators supported by lower operating expense levels.
Challenges
Ability to smoothly transition into a small finance bank.
Recruiting training and retaining manpower, as it converts into an SFB.
Issues like multiple borrower identities and limited coverage of credit bureaus need
to be addressed to reduce industry level risks.
Ability to manage political, communal and other risks across geographies of
operations.
High pace of growth, albeit growth largely driven by addition of new clients.
Ability to deepen the liability franchise and develop a strong deposit base on
conversion to an SFB
New Incumbents in the Senior Management Haresh R Wadhwa, Head - Operations He has been associated with the banking sector for over 22 years.
Prior to joining Utkarsh, he was with IndusInd Bank Ltd as Vice
President and Head - Process and Projects in General Banking
Operations and has domain expertise of processes and policy
documentation, vetting and Internal Controls. He was also
instrumental in setting up currency chests for the bank. Prior to
IndusInd Bank, he was with ICICI Bank as Chief Manager - Process
Reengineering at Corporate Office, holding various roles covering
retail operations, innovations, currency management including a stint for over a year in
ICICI Bank Plc, UK- London office handling Retail, Trade Finance and Corporate Operations.
He had also worked with UTI Bank Ltd (Axis Bank) and Shamrao Vithal Co-operative Bank
at various branches handling retail operations. He is a Commerce Graduate from Mumbai
University and also holds LLB Degree from Mumbai University, ICFAI - MBA (Diploma) and
CAIIB (Certified Associate of Indian Institute of Bankers).
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Mohan Kumar Sahni, Business Head - Cards
He has more than 11 years of experience in banking and finance
industry, especially in the domain of Cards (Debit, Credit, Prepaid and
Travel), Retail Forex and Remittances, Digital Channels, Products and
Rural as well as Corporate Banking. Prior to joining Utkarsh, he was
with Axis Bank Ltd. in various capacities of Marketing (as National
Activation Head - Branch Marketing) and Corporate Banking domains
(as Assistant Vice President in Corporate Relationship Group, New
Economy Strategic Clients). He had also stint with Thomas Cook India
Ltd as Senior Executive (Corporate Sales - Foreign Exchange), Bank of Punjab as Junior
Officer - Foreign Exchange and TATA Motors as Associate, Process Action Group. He
holds Post Graduate Diploma in Business Management from LLIM, Mumbai.
Employee Speak “…”
"For now over 7 years, I am working with Utkarsh. I especially appreciate the work
philosophy and ethics that I learnt here. The company not only provides a challenging
environment for a better career but also shapes us as a responsible individual with
integrity. Here, I have always been groomed & developed to be an effective & efficient
employee & more than that a responsible human being. I really feel precious as an
employee. I can very confidently say that Utkarsh is one of the best places to work.
Excerpts from a talk with Mr. Vinay Singh, Regional Manager- Microfinance Business
Varanasi.
OPERATIONAL HIGHLIGHTS
The outreach of the company grew to newer operational geographies in 10 states viz. Uttar
Pradesh, Bihar, Jharkhand, Delhi-NCR, Uttarakhand, Haryana, Himachal Pradesh,
Maharashtra, Madhya Pradesh and Chhattisgarh. The total districts being covered in 10
states grew to 108. The branch network expanded to 370 [344 JLG Branches and 23 MEL
Branches] with (3 MEL Branches having Housing Loan pilot business also) for serving more
than 1.2 Mn active clients.
At the close of Q2, FY 2016 -17, the JLG active client base was over 1.18 Mn with portfolio
outstanding at over ₹16,700 Mn, the MEL portfolio was ₹951.5 Mn with 16,816 active
clients and the Housing Loan pilot reached 122 active clients with ₹34.0 Mn portfolio
outstanding. The total portfolio of the Company was ₹17,740.7 Mn as on Sep. 30, 2016.
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A comparative summary of the operational highlights of the company is as below:
Particulars As on Sep 30, 2016
As on Mar 31, 2016
As on Sep 30, 2015
MICROFINANCE OUTREACH No. of States 10 10 9
No. of Districts 108 98 80
Total No. of Branches 344 321 277
No. of Branches in Uttar Pradesh 103 100 94
No. of Branches in Bihar 110 103 89
No. of Branches in Maharashtra 37 33 30
No. of Branches in Madhya Pradesh 29 29 23
No. of Branches in Delhi - NCR 8 8 8
No. of Branches in Uttarakhand 13 13 13
No. of Branches in Himachal Pradesh 1 1 1
No. of Branches in Haryana 17 16 15
No of Branches in Jharkhand 21 15 4
No of Branches in Chhattisgarh 5 3 -
Total No. of Centers 71,578 60,484 48197
Total No. of Groups 322,782 264,576 202,391
Total No. of Members 1,253,624 1,061,050 840,493
Total No. of Clients 1,185,764 995,810 776,353
Total Disbursement – Cumulative ( in Mn) 44,369.8 33,964.8 24,124.9
Loan Outstanding ( in Mn) (Own+ Managed) 16,755.2 13,433.4 9,218.3
Total No. of Loan Disbursed 2,555,819 2,054,248 1,552,361
Total No. of Credit Officers 1,823 1,520 1,278
No. of Client Per Credit Officer 650 655 607
Repayment Rate (%) 99.3% 99.9% 99.8%
Par > 30 Days
No. of Clients 2,972 1,138 325
Amount ( In Mn) 30.4 11.11 3.02
MICRO ENTERPRISES LENDING No. of States 7 5 4
No. of Districts 23 21 16
Total No. of Branches 23 21 18
Total No. of Loan Disbursed 21,582 17,463 11641
Total No. of Clients 16,816 14,326 9924
Total Disbursement – Cumulative ( in Mn) 1,663.6 1,315.4 816.0
Loan Outstanding ( in Mn) (Own +Managed) 951.5 871.3 557.1
No. of Relationship Officer (RO) 251 141 83
No. of Clients /RO 67 102 120
PAR > 90 Days
No. of Clients 470 367 426
Amount (In Mn) 18.4 14.65 18.60
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Particulars As on Sep 30, 2016
As on Mar 31, 2016
As on Sep 30, 2015
AFFORDABLE HOUSING LOAN No of States 2 2 2
No. of Districts 2 2 2
Total No of Branches 2 2 2
Total no of Loan Disbursed 128 72 22
Total No. of Clients 122 72 22
Loan Outstanding (₹ in Mn) 34.0 20.2 4.8
NATIONAL PENSION SYSTEM (NPS) No. of States 2 2 2
No. of Districts 13 13 13
Total No. of Branches 53 53 53
No. of Accounts 34,136 34,143 34,143
Total Subscription-Cumulative ( in Mn) 11.3 11.8 10.51
EMPLOYEES Operational Employees 2,785 2,430 2092
Total Employees 3,188 2,636 2282
EMPLOYEE DETAILS
Particulars As on Sep 30, ‘2016
As on Mar 31, ‘2016
As on Sep 30, ‘2015
JLG Operations 2546 2188 1892
MEL and AHL Teams 307 261 220
Support and Control Teams 335 187 170
TOTAL 3188 2,636 2,282
FINANCIAL PERFORMANCE The Company achieved a PBT of `371.38 Mn for Q2 FY 16 - 17. Important financial parameters are as below:
Particulars As on Sep 30, ‘2016(Unaudited)
As on Mar 31, 2016 (Audited)
As on Sep 30, ‘2015 (Unaudited)
Income (` in Mn) 1952.63 2537.8 1081.91
Expenses (` in Mn) 1581.25 1926.7 814.29
Profit Before Tax (` in Mn) 371.38 611.1 267.62
Net Worth (` in Mn) 5137.03 2,525.8 2372.74
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Key indicators Q2 FY 2016 - 17
SOCIAL INTERVENTIONS (Credit Plus Activities)
HEALTH INITIATIVES
In order to provide primary health care services in Company’s operational area where
medical facilities are limited, Utkarsh Welfare Foundation (UWF) has tied up with Ram
Krishna Sewashram Hospital and GV Meditech Group. In association with them, UWF
organizes Poly Clinics at Branches and also through Mobile Vans.
The Regular Poly Clinics are organized fortnightly every month through 8 branches. The
beneficiaries are given free medical consultation and medicines. A total of 43 regular Poly-
Clinics were organized during Q2 FY 2016-17, benefiting 4,325 patients.
Similarly, the Medical Mobile Van facility is presently operating through 10 branches; 5 in
Satna Division, Madhya Pradesh and 5 in Gorakhpur Division, Uttar Pradesh. A total of 58
Medical Mobile Van Poly-Clinics were organized during Q2 FY 2016-17, benefiting 10,716
patients. Till Sept. 2016, a total of 208 Medical Mobile Van Poly-Clinics have been
organized and 32,051 patients have benefitted with medical services.
In the Q2 FY 2016 -17, a total of 15,041 patients have been provided with Primary Medical
Health Care services across 18 branches.
FINANCIAL AWARENESS:
In association with Swiss Capacity Building Facility (SCBF) – ACCION
This project was launched in May 2015, in 5 branches and during Q2 FY 2016 - 17, a total
of 3,319 beneficiaries received Financial Literacy training. Cumulatively, a total of 18,218
beneficiary has been trained so far. The SCBF project is currently operated in Azamgarh,
Bhojpur, Brahmpur, Chota Jamalpur and Harahua.
Key Indicators As on Sep 30,
2016 (Unaudited) As on Mar 31, 2016 (Audited)
As on Sep 30, ‘2015 (Unaudited)
CRAR 29.74% 20.68% 26.01%
Operating Self Sufficiency
(OSS)
124.6% 133.3% 134.2%
ROA 2.60% 3.29% 3.40%
ROE 14.29% 15.88% 14.46%
Debt Equity 2.78% 4.81 3.32%
Operating Expense Ratio 8.63% 7.16% 7.13%
Cost of Borrowing 12.55% 13.48% 13.99%
On Time Repayment Rate 99.3% 99.9% 99.98%
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Utkarsh Welfare Foundation - Financial Literacy Program
UWF Financial Literacy Program was launched in September 2015 through 9 branches in
Bihar and Madhya Pradesh; but now the program is operated through 8 branches. During
Q2 FY 2016 – 17, a total of 4,345 beneficiaries had completed financial literacy training
through 8 branches viz. Amarpattan, Bara Chakia, Bettiah, Gyanbabu Chowk, Maihyar,
Narkatiyaganj, Rewa and Satna. Cumulatively, a total of 15,439 beneficiary has been
trained so far.
Dialogue on Business
The project was launched in June, 2016 initially with Varanasi Branch and now the DoB
project is also implemented in Micro Enterprises Loan Allahabad branch. The project is
designed to train MEL clients on self-management, cash management and enterprises
management. For Q2 2016-17, a total of 166 clients have been trained.
In association with FMO Project- The project was launched in June, 2016 through 5 branches of Uttar Pradesh. Now,
currently the project is being implemented through 9 branches (Ashok Vihar, Dighwara,
Garkha, Jalalpur, Madiyahoo, Naupedwa, Panchkoshi, Parmanantpur and Sonpur).
For Q2 2016-17, a total of 4,492 beneficiaries had completed financial literacy training
across 9 branches.
In the Q2 FY 2016-17, the Financial Literacy Education Program reached 12,322
beneficiaries.
Mass Awareness Program
Community Mass Awareness Camps were also conducted at village levels, wherein 4,566 beneficiaries participated across 10 camps.
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Success Stories – as clients speak “…”
Varanasi City is famous for its
culture and religious activity.
It’s not so easy for me to forget
the struggling days, when we
were facing the problem of our
daily survival. The earning of
my husband from his small
tailor shop was minimal which
was not enough to take care of
the entire family of five.
So, I decided to help my
husband in his business but
due to lack of financial
assistance it was difficult to
scale up.
I was delighted when one of my
neighbour told me about
Utkarsh Micro Finance & helped
me to meet an Utkarsh Official
who motivated me to take an
income generating loan & scale up my small business.
With an initial loan of ₹10,000/-, I purchased essentials and accessories for sewing and
with the subsequent loan of ₹15,000/-, purchased another sewing machine. So, that I help
my husband in managing the household expense.
Slowly and gradually our business got acknowledgement and today we are able to meet
our daily needs, send our children to school and save something for better future.
My two sons Roshan & Vishal and my daughter Janvi go to good convent school.
Recently, Utkarsh has allotted us a loan of ₹25,000/- to expand our tailor shop and now we
have started selling our own stitched clothes.
Our family feels good in getting timely linkage with Utkarsh on our credit requirements.
Ms. Seema Devi, a resident of Teliyabagh (Varanasi, Uttar Pradesh), is a client of Utkarsh
– Sigra Branch since Feb 2012.
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UTKARSH in NEWS
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बाढ़ पीड़ित सहायतार्थ राहत सामग्री ड़ितरण
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Your feedback is important to us. Please write to us at:
Manager, Corporate Communication, Utkarsh Micro Finance Ltd. S2/639-56, Varuna Vihar Colony, J.P. Mehta Road, Cant., Varanasi - 221002, Uttar Pradesh E-mail ID
[email protected] website www.utkarshmfi.com
SKOCH (GOLD) INCLUSIVE INSURANCE AWARD 2016
3rd Batch Reward & Recognition Tour to Jaipur from July 09 to July 13, 2016
mailto:[email protected]://www.utkarshmfi.com/