Diversified financial services provider Equitas plans to offer gold loans as an additional product when its proposed small finance bank becomes operational, PN Vasudevan, Managing Director, Equitas Holdings, said.
Equitas is among the 10 successful applicants that bagged in-principle nod from the RBI last year to launch small finance banks (SFBs).
Vasudevan said that the proposed SFB would offer gold loans primarily to customers in semi-urban and rural areas.
Gold loans will be in addition to products, such as microfinance, used commercial vehicle finance, housing loans, and micro and small enterprise finance that would be offered by the proposed bank. “There is huge potential in gold loans. We can leverage our existing branch network to offer this product through the proposed small finance bank,” Vasudevan told
Public issue Plans are also afoot to provide two-wheeler finance to existing customers of Equitas. As of December 31, 2015, Equitas had 539 branches across India. Equitas Holdings — the holding company (core investment company) which has bagged the SFB licence — is enter the market on April 5 with a fresh issue of shares aggregating ₹720 crore. Simultaneously, there will an offer-for-sale by some existing investors aggregating to about ₹1,500 crore. The OFS will help pare foreign stake in Equitas Holdings to 35 per cent from about 92 per cent now.
The proposed SFB will be created from the merger of three existing subsidiaries of Equitas Holdings — Equitas Micro Finance, Equitas Finance and Equitas Housing Finance. The merger scheme was approved in January by the RBI and the National Housing Bank, which is the housing finance regulator.