Vijaya Bank customers can soon hope to get their home loan applications processed within six working days, as the bank looks at centralising its loan processing activities under the retail and MSME segments, in order to reduce the turnaround time in sanctioning advances. This step, the bank hopes, would help it scale-up lending to these segments.

“We would like to strengthen the credit delivery mechanism under the retail and SME segments. What we intend to do is build capabilities within the bank, so that our retail and MSME segment operations can be scaled up in a big way,” Mr H.S. Upendra Kamath, who took over as the Chairman and Managing Director of Vijaya Bank recently, told Business Line .

The bank's retail portfolio grew at 8.2 per cent only during the 2010-11 fiscal, while the MSME segment grew at around 22 per cent.

“We would like to scale the retail portfolio up to at least 20 per cent in the current year, and the MSME advances to 30 per cent,” he said, adding that without infrastructure in place, “to expect a growth of 20 per cent of retail and 30 per cent of MSME will be far-fetched”.

Though the bank had centralised the retail loan sanctioning activity a few months ago, it was only for mortgage-based loans, Mr Kamath pointed out.

“The working of these centralised processing cells will be revisited and their scope expanded. We will ensure that they look at most of the retail parameterised loan products rather than only mortgage-based products,” he said.

According to him, the bank does not have a centralised set-up for MSME advances yet, but this would be created during the course of the year.

Mr Kamath also said that the centralised processing cells will be adequately staffed and given software for online processing of loan applications.

Turnaround time

Since a reduced turnaround time is the need of the hour, “we want to ensure that housing loans are given a decision within six working days, educational loans within three working days, and vehicle loans within two working days”, he said.

Marketing team

The bank, which does not have a marketing team now, will soon get one not only for retail, but also for covering the MSME segment.

“If a need arises, based on the findings on the manpower planning, we will also recruit adequate number of people for the purpose,” Mr Kamath said, adding that the numbers are yet to be firmed up.

Besides, the bank will also outsource activities such as residential address verification, employment details verification and income details verification. “Of course, these will only act as the second level of due diligence; the first level of due diligence will continue to be done by the branch heads,” he explained.

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