Gurugram / New Delhi: Home Credit India Finance Pvt. Ltd., one of India’s fastest growing non-bank financial companies, has received an IND A- / Stable rating from India Ratings and Research Pvt. Ltd., a Fitch group company.

In addition, the rating was increased by CARE Ratings to A- from BBB +. The new rating is based on factors such as an experienced management team, comfortable capitalization and liquidity, adequate risk monitoring and assessment systems, a unique business model, a strong concentration in the Indian market, a profitable point of sale network and continued support from Home Credit Group.

According to India Ratings, one of the main rating drivers is that India is a high potential market in Asia for Home Credit Group.

“India offers a large population with high mobile penetration and low competition in financing the low-cost unsecured consumer durable goods segment. Based on available credit history, the company leverages the credit life cycle of existing customers by offering personal cross-selling loans, ”the rating agency said.

Noting that Home Credit India’s market share in the mobile finance segment has grown steadily, India Ratings said this gives the consumer loan provider a competitive edge in key geographies relying on small players in the retail format. for mobile sales. The growing market share along with Home Credit India’s foray into online lending further enhances scalability.

In a separate memo, CARE Ratings said Home Credit India’s capitalization is comfortable and is supported by a continuous injection of promoters’ equity. Compared to the regulatory requirement to have a minimum capital adequacy ratio (RCA) of 15%, the company had a RCA of 26.33% as of March 31, 2018. Stressing adequate capitalization as an important driver, India Ratings said: “It has adequate liquidity due to the tenor short lead times extended. “

According to Anirban Majumder, CFO, Home Credit India, “The rating demonstrates growing confidence in the underlying strength and long-term potential of our business in the retail credit market in India.

This will allow us to strengthen and expand our relationships with banks and financial institutions, which will help us to penetrate more deeply into the capital market with various financing instruments. It is also an affirmation of HC Group’s proven partnership model with manufacturers and retailers and its ability to offer seamless online lending, providing customers with an omnichannel experience, choice and convenience. “

In its efforts to take advantage of the latest technologies to increase the scale and size of operations, India Ratings said that Home Credit’s underwriting standards and tools are based on a risk analysis framework, the effectiveness of which is has been demonstrated in prosperous geographies such as China and Russia. The two rating agencies also claimed that the financial support and credit profile of Home Credit BV (“ HCBV ” or “ the Group ”), the Netherlands-based holding company for credit transactions to another key driver is the multi-channel consumption of Home Credit in Central and Eastern Europe, Asia and the United States.

To support business growth, Home Credit India has diversified its funding base in terms of instrument types and maturity, and continues to attract flexible and stable funding sources based on long-term and mutually beneficial relationships with Investors. During the January-March quarter, Home Credit India raised Rs. 600 crore through a mix of securitization transactions, term loans and issuance of non-convertible debentures (NCDs). The company plans to use the financing to increase its loan portfolio, invest in technology infrastructure and develop financing products that meet the needs of clients with little or no credit history.

Since its launch in India in 2012, Home Credit India has continued to expand its business. The company had nearly 2 million customers in 2016, driven by a pan-Indian expansion in key markets, a diverse and innovative product line supported by a superior customer experience. In 2017 alone, Home Credit added 3.5 million more customers, further strengthening its leadership position in consumer credit. (ANI)