Bajaj Auto’s proposed NBFC for financing two-wheelers manufactured by the company, is likely to take another year to be set up till which time Bajaj Finance will build its own non-Bajaj portfolio, MD Rajeev Jain said.

“This was announced a year ago. I think they’ve applied for one (licence). As they get the licence, they set it up, . In a 24-month horizon, you should see no change, but we’ll see,” Jain said when asked about the impact of the proposed NBFC on Bajaj Finance.

“It’s 5 per cent of our balance sheet today, which is essentially captive. We’ve also started open architecture two-wheeler financing,” he added. He was speaking in an investor call on the company’s Q4 and FY23 results.  

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Open architecture vertical

Bajaj Finance launched its open architecture vertical for two-wheeler finance in June-July, wherein the company is adding 11,000-13,000 new accounts every month, Jain said, adding that the aim is to add 2.5-3.0 lakh non-Bajaj two-wheeler loans in FY24.

“It’s a staggered roll out. For the first six months, we did not roll out in many cities. Having gained confidence, we have now accelerated the pace a little bit,” he added.

CFO Sandeep Jain said that Bajaj Finance moves a significant volume for Bajaj Auto and “remains a large partner for them”.

“Post the RBI licence to run their own NBFC , they can decide what they deem appropriate for their company. We continue to run the business,” he said.

Bajaj Auto had in October 2021 announced setting up of a wholly-owned captive finance subsidiary, likely to be named Bajaj Auto Consumer Finance, subject to regulatory and government approvals.

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