GRT group promoters to infuse Rs 50 crore afresh in NBFC arm
As of March 31, 2024, there is no non-performing asset (NPA), he said, when asked about the recovery outcomes. RAR Fincare is also looking at enhancing its paid up capital to Rs 175 crore
CHENNAI: The promoters of the city-based GRT group, renowned for jewellery and hospitality businesses, are gearing up to make a fresh equity infusion in RAR Fincare Ltd, their diversified non-banking finance venture.
The RBI-approved entity, seeded with a paid-up capital of Rs 129.74 crore, is readying itself for the fresh equity infusion of Rs 50 crore by the founder-promoters – Govindarajulu Rajendran, Govindarajulu Rajendran Ananthapadmanabhan, Govindarajulu Rajendran Radhakrishnan.
RAR Fincare is helmed by Venkatasubramanian Ramanathan, a finance veteran. Supported by a 25-member team, the CEO is an accomplished senior banker, who has held leadership positions in various banks such as Canara Bank, ICICI Bank, Kotak Bank and City Union Bank, prior to joining the Chennai-based GRT-founded NBFC, which got the Reserve Bank of India license on February 2, 2021.
Founded to fulfil the credit needs of businesses, including micro small and medium enterprises or MSMEs, RAR has been disbursing credit through 84 small NBFCs across the country – Punjab, Maharashtra and Rajasthan, to name a few, he told DT Next.
“Our focus is on the rural segment and the small and medium enterprises. We would like to meet the financial needs of micro enterprises, lending upwards of Rs 50,000 to Rs 3 lakh, without collaterals. Rather than allowing these SMEs to be charged usurious rates by money lenders (upwards of 28 per cent), our objective is to cater to such stakeholders via small NBFCs that lend without the typical bank requirement of credit ratings. This way, we are able to serve the needs by offering interests in the range of 16 to 20 per cent, which effectively is our margin for overheads,” Venkatasubramanian said, as he sought to explain the use of the banking correspondent arrangements.
As of March 31, 2024, there is no non-performing asset (NPA), he said, when asked about the recovery outcomes. RAR Fincare is also looking at enhancing its paid up capital to Rs 175 crore, he said, noting that the company had also applied for CARE rating agency so that the borrowing and leveraging exercise can be done seamlessly. Right now, RAR Fincare has assets worth Rs 127 crore under management and has posted a net profit of Rs 8.5 crore.
The CEO also said, “RAR Fincare as an entity supports social enterprises, which address the credit and livelihood requirement of the tier 2, 3, 4 cities, rural folk especially women in the form of micro loans, small business loans, farm loans, vehicle loans, micro LAP, etc. This would mean funding smaller regional NBFCs which operate in rural tier III and tier IV locations primarily un-banked areas.”
Asked if this foray would make the NBFC a unique offering by a jewellery brand, Venkatasubramanian said in Chennai, this could perhaps be true.
Noting that RAR Fincare ensures customer-centricity and builds customer intimacy through the right mix of physical touchpoints, field staff, digital touchpoints, and vernacular promotions, he said it has drafted a comprehensive and well-equipped business strategy and implementation plan to streamline operations and to provide a high level of efficiency in services.