Bandhan Financial Services said on Wednesday it has appointed consultancy firm Deloitte as adviser to transform its microfinance operations into mainstream banking.
The Kolkata-based microfinance major was one of the two players picked by the Reserve Bank of India (RBI) from among 25 applicants for new banking licences early last month.
Bandhan, which had earlier been talking to different consultancy firms such as McKinsey, Ernst & Young, BCG and KPMG, beside Deloitte, finally roped in the New York-headquartered consultancy major as it was found the “most competent” for the job.
“We had a committee which shortlisted the companies for the advisory role. And we found Deloitte the most competent for advising us on transforming our MFI operations into banking within 18 months,” Bandhan Financial Services chairman & managing director Chandra Shekhar Ghosh told FE. Significantly, the MFI had last year appointed Deloitte for preparing the blueprint for applying to the RBI for banking foray.
Ghosh said Bandhan has already constituted a 30-member team for facilitating the transition and Deloitte would work with it.
He, however, said the consultant major would not advise the MFI on the hiring requirements to commence banking operations.
Bandhan earlier said it is likely to come up with about 600 bank branches across the country while foraying into full-fledged banking operations within 18 months. About 80% of the upcoming bank branches would be unbanked rural areas.
“By 18 months, we will come up as a full-fledged bank. To start with, we are likely to have about 600 bank branches in 22 states across the country,” Ghosh had said. As a full-fledged bank, Bandhan will focus on its more than 54 lakh existing customers. It also expects to have 1 crore basic savings accounts from Day 1 of its banking operations.
“While we understand that the transformation into a bank is likely to have challenges, we are suitably geared up to meet these head-on. We have identified the areas where we need to strengthen our model, and have prepared a detailed implementation road-map. We have dedicated teams working on the identified areas and have made satisfactory progress on most work-streams,” it said in a release.