Chennai-based Cholamandalam Investment lines up aggressive growth plans

Cholamandalam Investment and Finance Company Ltd, the financial services division of diversified conglomerate Murugappa Group, on Wednesday said it has launched three new business divisions under the consumer and SME business.

The Chennai-based leading player in vehicle finance, loan against property, and housing finance business, said it has entered into an agreement with Payswiff Technologies Pvt Ltd to make a ''strategic investment not exceeding Rs 450 crore'' in one or more tranches.

According to a company statement, Chola said it was launching the Consumer and Small Enterprise Loan (CSEL), Secured Business Personal Loan (SBPL) and Small and Medium Enterprise (SME) Loan under the consumer and SME division.

''CSEL will focus on new product segments -- personal and professional loans, micro and small enterprise loans -- through traditional, direct to consumer and digital partnership channels,'' the statement said.

Chola said it has entered into a strategic partnership with three leading financial technology companies -- BankBazaar, Kreditbee and Paytail. ''With these alliances, the company intends to drive greater financial inclusion especially among those customers who are economically active but not having adequate access to formal credit,'' the statement said.

Through the Secured Business and Personal Loan vertical, Chola said it would offer loans to self-employed non-professionals through traditional channels. ''These loans will enable small businesses like traders and service providers to meet their funding requirements for day-to-day operation and business improvements,'' Chola said.

''We are excited to launch three new business divisions in the consumer and SME eco-system spaces. We have also partnered with leading Fintech companies -- BankBazaar, Kreditbee and Paytail. All these brands come with a culture of innovation and excellence, and proven track records in their respective domains'', Cholamandalam Investment and Finance Company Ltd., Chairman, Vellayan Subbiah said.

Subbiah said the company was also in advanced discussions with many more financial technology companies and digital ecosystem partners for securing personal loans, professional loans, micro, and small business loans.

''The company is expecting to go live with these partnerships over the next 3-4 months... we believe that these partnerships will help us in large scale customer acquisition and drive our next wave of growth...,'' he said.

On the investment in Payswiff Technologies, Chola said it has entered into an agreement to make a strategic investment in the equity shares of Payswiff Technologies Pvt Ltd up to a sum not exceeding Rs 450 crore in one or more tranches.

Paysiff is a leading point-of-sale provider in the country enabling online payment gateway services for e-commerce businesses.

''The total investment will result in the company holding about 70 per cent of the equity capital of Payswiff on a fully diluted basis and Payswiff will become a subsidiary of Chola,'' the company said.

Subbiah said, ''Chola will become the majority investor in Payswiff post-investment transaction and will be uniquely positioned among NBFCs to offer a comprehensive product offering to meet end-to-end needs of MSMEs.'' ''This acquisition proposal is in line with the long-term strategy of the company to explore and expand in the entire lending ecosystem particularly in the MSME segment... this investment will provide a platform to build new-age MSME offering at scale and access to the MSME network across the country,'' he added.

Payswiff MD and CEO Prabhuram said, ''...we are excited to join hands with Chola, one of the largest NBFCs in India. This presents us a unique opportunity to jointly work in leveraging strengths and gives us the power and ability to be at the forefront of driving innovation and transform India's financial and banking services''.