Bajaj Finance is India’s largest non-bank lender, built on a simple idea: capture a customer with a first purchase - often a television or a phone - and then keep that customer for life by offering them everything from personal loans to mortgages. It began in 1987 as a captive financier for Bajaj Auto vehicles and transformed itself from 2008 onward into a diversified financial services company that now operates 32 different lines of business serving 119 million customers. The recurring approach that explains everything else is a cross-sell engine: the EMI Card acts as the front door, and once a customer is inside, data and analytics determine which of the many loan products to offer next, turning a single transaction into a decades-long relationship. # Business segments Five lending engines at different stages - a consumer-finance giant that brings customers in, a mortgage lender that locks them in for decades, an SME and commercial book that lends to businesses, a rural network that reaches where others don’t, and a fast-growing gold-loan business - all funded in part by a deposit franchise that lowers the cost of money. ## 1. Consumer lending: the front door that acquires customers for life **The EMI Card turns a one-time shopper into a pre-approved borrower across every product the company sells, with 94 million cards in force.** - **The card is the relationship anchor** - an Existing Member Identification card issued after the first purchase lets a customer walk into any partner store and get instant finance without reapplying, which is why 58% of all new loans in FY2025 came from existing EMI Card holders. - **Everyday spending becomes a loan** - the business finances consumer electronics, furniture, lifestyle purchases, and even small-ticket items like eyewear and car servicing across more than 210,000 physical stores, so the company is present wherever a customer might make a discretionary purchase. - **Pre-approved personal loans follow the data** - once a customer has a repayment track record, the company uses risk analytics to offer pre-approved personal loans without a fresh application, which is how the cross-sell personal loan book reached roughly ₹50,000 crore. - **Vehicle finance is being deliberately shrunk** - the legacy business of financing Bajaj Auto two-wheelers and three-wheelers was stopped entirely in December 2024 after the manufacturer set up its own finance company, and the remaining captive portfolio of less than 1% of assets is being wound down. - **The app is the digital storefront** - with over 86 million net users, the Bajaj Finserv app bundles loans, deposits, payments, and a marketplace into a single stack, so a customer who came for an EMI card can discover a home loan or a fixed deposit without ever visiting a branch. ## 2. Mortgages: the long-duration asset that anchors the balance sheet **Bajaj Housing Finance locks in salaried and self-employed borrowers for 15 to 20 years with home loans, then cross-sells loans against property and developer finance - all with near-zero defaults.** - **Home loans are the core, sourced through builders** - the company lends to category A and A+ developers for construction, and those relationships become a pipeline of retail home-loan customers buying apartments in the same projects, with an average ticket size of about ₹48 lakhs. - **Loan against property doubles the relationship** - self-employed borrowers who may not have a salary slip can pledge their residential or commercial property as collateral, with an average ticket of ₹88 lakhs, which opens the mortgage franchise to a segment banks often find hard to underwrite. - **Lease rental discounting serves the ultra-rich** - high-net-worth individuals and private equity funds borrow against commercial property leased to corporate tenants, with every rental payment routed through an escrow account so the lender gets paid before the borrower does. - **Asset quality is the moat** - gross non-performing assets are just 0.27% and net NPAs 0.11%, which means the company can borrow cheaply (it holds AAA ratings) and pass that advantage on as competitive loan rates. ## 3. SME and commercial lending: lending to the businesses that banks overlook **The company is the largest business-loan originator in India by volume, focusing on small enterprises with ₹15-17 crore in sales and mid-sized corporates in niche industries.** - **Unsecured business loans at scale** - the company lends without collateral to micro and small enterprises across nearly 2,600 locations, using bureau data to capture a 21-23% market share of all business loans booked in the country. - **Professionals are treated like small businesses** - doctors, chartered accountants, and lawyers get secured and unsecured loans through the same branch network, including equipment finance for medical gear ranging from ₹3 lakh to ₹30 crore. - **Mid-corporates fill the gap above SMEs** - dedicated teams cover auto ancillaries, pharma, specialty chemicals, and packaging companies with term loans for expansion and acquisitions, and this book along with loan-against-securities has near-zero defaults. - **Growth was deliberately slowed to manage risk** - the MSME book grew only 6% in FY26 because the company tightened lending standards from the second quarter onward, expecting to resume double-digit growth only by mid-FY27. ## 4. Rural lending: a full-service bank branch in villages that have none **A hub-and-spoke model delivers ten different loan products - from consumer durables to gold loans to microfinance - across 2,571 towns and villages through 68,000 points of sale.** - **The same cross-sell playbook, adapted for small towns** - rural customers enter through a consumer durable loan or a digital product loan, and the company then offers personal loans, gold loans, tractor finance, and affordable mortgages from the same relationship. - **Gold loans are the fastest-growing piece** - the gold-loan book more than doubled in the last quarter of FY26 and now contributes 3.5% of total assets, with 1,507 dedicated branches, half of all new hires in the quarter going to gold-loan and microfinance branches. - **Credit losses forced a deliberate slowdown** - when rural B2C losses spiked in FY2024, the company cut growth from 25% to 6% in a single quarter rather than chase volume, because the philosophy is to protect the book first and grow second. ## 5. Deposits: the funding engine that makes lending cheaper **A ₹68,500-crore deposit franchise - built from retail savers, not just corporates - supplies 16% of the money the company lends out, lowering its overall cost of borrowing.** - **Retail depositors provide sticky money** - individuals contribute 59% of the deposit book, and nearly three-quarters of new deposits are opened paperlessly through the app and website, which keeps acquisition costs low. - **The AAA rating makes savers trust it** - both CRISIL and ICRA rate the deposit programme at the highest grade, so a retail fixed deposit competes directly with bank deposits on safety while offering higher rates. - **Digital-only deposits pull in new customers** - a 42-month fixed deposit launched exclusively on the Bajaj Finserv app and website in early 2024 pays a premium rate and brings in savers who may never have borrowed from the company, widening the funnel in reverse. # FINAI: the technology backbone that runs across every segment **The company is rewiring itself as a “FINAI” business - not by adding chatbots, but by embedding autonomous AI agents into sales, underwriting, collections, and customer service so that every process runs faster and cheaper than manual operations.** - **AI agents are doing real work, not just answering queries** - 27 autonomous agents are already live, with plans to scale to over 800 across sales, operations, debt management, HR, and risk in FY27; one measure of their impact is that AI-generated leads produced ₹5,520 crore in disbursals in FY26. - **Customer service is shifting to self-service** - 72% of do-it-yourself servicing now happens through AI voice and text bots, and by mid-2026 every customer interaction channel will have a text AI bot embedded, which reduces the need for human call-centre staff as the customer base scales toward 200 million. - **The data infrastructure was rebuilt from scratch** - the company moved from a traditional data warehouse to a Data Lakehouse on Microsoft Azure, streaming real-time information across channels so that 1,500 campaigns a day can be personalised and executed through call centres, WhatsApp, SMS, email, and social media simultaneously. # Group structure and partners **Bajaj Finance sits inside the Bajaj group, controlled by listed parent Bajaj Finserv, and operates through two key subsidiaries - a housing finance company and a securities broking firm - while distributing insurance and co-branded cards through partnerships that generate fees without using its own balance sheet.** - **Bajaj Housing Finance is the most valuable subsidiary** - BFL owns 86.7% after the mortgage lender’s IPO in September 2024 and a subsequent stake sale to meet public-shareholding rules, and it raised ₹2,000 crore from BFL via a rights issue before listing. - **Bajaj Financial Securities adds capital-market products** - this wholly-owned subsidiary offers broking, demat accounts, and margin-trade financing to 1.29 million retail clients and 90,000 high-net-worth individuals, with a loan book of nearly ₹8,000 crore. - **Insurance distribution is a fee engine, not a lending business** - registered with the insurance regulator as a corporate agent, the company is tied up with 17 insurers to sell life, health, and general insurance, and it also distributes mutual funds and fixed deposits through a digital marketplace in which it holds a 19.9% stake. - **The Airtel partnership opens a distribution pipe to 375 million telecom customers** - announced in early 2025, the deal puts Bajaj Finance’s 27 product lines onto the Airtel Thanks App, with an Insta EMI card that works at over 150,000 stores across 4,000 cities. - **Co-branded credit cards were paused but not abandoned** - incremental sourcing of cards with RBL Bank and DBS Bank was mutually halted in late FY2025, though the existing 3.4 million cardholders continue to be serviced.