Poonawalla Fincorp’s Strategy to Achieve Industry-Leading NPA Metrics

Poonawalla Fincorp Limited, under the leadership of Managing Director Abhay Bhutada, has achieved industry-leading Gross Non-Performing Assets (GNPA) below 1% and Net Non-Performing Assets (NNPA) below 0.5% as of May 31, 2024. This success is attributed to a strategic vision focusing on prudent credit policies, robust risk management, and digital transformation. Bhutada's leadership has driven the company to exceed its targets ahead of schedule, emphasizing rigorous credit assessment, advanced risk management, and enhanced collection efficiency. By prioritizing customer-centric solutions, leveraging digital innovation, and maintaining strong financial performance, Poonawalla Fincorp sets new benchmarks in the industry. With a continued focus on asset quality, digital enhancement, and exploring growth opportunities, the company is well-positioned for sustained success in the future.

1. Poonawalla Fincorp’s Strategy
to Achieve Industry-Leading
NPA Metrics

2. Strategic Vision and Leadership
Dynamic Leadership: Abhay Bhutada,
MD, led the company with a strategic
vision.
Vision 2025: Set ambitious targets
including NNPA below 1% by 2025.
Exceeded Targets: Surpassed goals
with GNPA below 1% and NNPA below
0.5% by May 31, 2024.
Resilience and Growth: Bhutada's
leadership drove exceptional growth
and resilience.

3. Emphasis on Prudent Credit Policies
Credit Assessment: Implemented rigorous credit policies.
Risk Mitigation: Carefully assessed borrower creditworthiness to minimize
defaults.
Stringent Lending Criteria: Implemented strict lending criteria to ensure timely
repayments.
Asset Quality Maintenance: Disciplined lending approach contributed to low
NPA levels.

4. Robust Risk and Governance Practices


Advanced Risk Management: Invested in advanced risk management systems.
Regular Stress Testing: Conducted stress tests and scenario analysis.
Portfolio Diversification: Diversified portfolios to mitigate risks.
Transparency and Compliance: Maintained strong governance to adhere to
regulations.

5. Enhanced Collection Efficiency
Technology Adoption: Leveraged technology for streamlined collections.
Data-Driven Approach: Utilized data analytics to manage repayments
effectively.
Prompt Addressing: Ensured overdue accounts were promptly addressed.
Higher Recovery Rates: Proactive collections led to improved recovery rates.

6. Digital Transformation and Innovation
Digital-First Approach: Embraced digital lending processes.
Enhanced Customer Experience: Improved service delivery through digital
onboarding and repayments.
Operational Efficiency: Reduced costs and enhanced risk management through
digital integration.
Technology Integration: Integrated technology across all operational aspects.

7. Focus on Customer-Centric Solutions
Product Diversity: Offered various financial products catering to diverse
customer needs.
Accessibility and Affordability: Ensured products were accessible, affordable,
and convenient.
Customer Satisfaction: Prioritized customer satisfaction to foster loyalty.
Long-Term Relationships: Built long-term relationships with customers.

8. Strong Financial Performance
Robust Growth: Witnessed significant growth in Assets Under Management
(AUM) and profitability.
Standalone AUM: AUM stood at ₹25,003 crore as of March 31, 2024.
Profitability: Profit After Tax (PAT) crossed ₹1,000 crore.
Investment and Expansion: Financial strength enabled investment in
technology and expansion.

9. The Road Ahead
Continued Focus: Aimed to maintain focus on asset quality, customer-centric
solutions, and innovation.
Strengthened Risk Management: Planned to enhance risk management
practices further.
Digital Capabilities Enhancement: Focus on improving digital capabilities for
better service.
Exploring Growth Opportunities: Planned to explore new avenues for growth
under Bhutada's leadership.