### **Overview** Fusion Finance Limited (formerly **Fusion Micro Finance Limited**) is one of India’s leading **non-deposit-taking NBFC-Microfinance Institutions (NBFC-MFIs)**. Established in **2010**, the company began operations under the **Grameen-inspired Joint Liability Group (JLG)** model, providing collateral-free microloans to underserved rural women entrepreneurs. Over time, it has evolved into a diversified rural financial services provider, rebranding in **2024** to reflect this broader mandate. Listed on the **BSE (543652)** and **NSE (FUSION)** since **November 2022**, the company is backed by premier institutional investor **Warburg Pincus**, which entered in **2018**, signaling strong confidence in its governance and growth trajectory. --- ### **Corporate Structure & Promoters** Fusion Finance Ltd is promoted by: - **Mr. Devesh Sachdev** (Founder and key promoter) - **Honey Rose Investment Ltd.** - **Creation Investments Fusion, LLC** - **Creation Investments Fusion II, LLC** The company transitioned from "Fusion Micro Finance Limited" to "Fusion Finance Limited" in **May 2024**, aligning its identity with its strategic expansion beyond microfinance while maintaining compliance with regulatory requirements—ensuring **at least 75% of assets remain in qualifying microfinance activities**. --- ### **Leadership** - **Mr. Sanjay Garyali** assumed the role of **CEO in March 2025**, bringing over **28 years of experience** in retail and consumer finance. - Prior to joining, he led the **Urban Finance business at L&T Finance**, managing a portfolio of **₹40,000 crore**. - He has spearheaded digital innovation, including the development of advanced credit engines and a fully digital consumer finance product. --- ### **Business Model & Key Segments** Fusion operates through **two core verticals**: #### 1. **Microfinance (Core Segment)** - **Target Client**: Underserved and unserved women from low-income rural households. - **100% female clientele**, organized into **JLGs of 5–7 members**. - **Primary Use of Loans**: Income-generating activities such as agriculture, allied sectors, small businesses, and micro-enterprise development. - Offers complementary financing for **productivity-enhancing assets** (e.g., mobile phones, bicycles). - **Geographic Focus**: 22 states and 3 Union Territories; **93% of clients reside in rural areas**. #### 2. **MSME Lending (Strategic Growth Vertical)** - Launched in **December 2019** as a dedicated unit to serve the **"missing middle"** segment of micro and small enterprises. - **Target Clients**: Informal and formal micro-enterprises with business vintage of **minimum 2 years**. - **Loan Range**: ₹1 lakh – ₹15 lakh; Tenure: 12–120 months. - **Mandatory Female Co-Applicant**: Reinforces women’s financial inclusion. - **Lending Criteria**: - Cash flow-based underwriting (not salary-based) - Minimum **CIBIL score of 700** - Shop or residence ownership required - **LTV capped at 65%** for secured loans --- ### **Financial Performance (Q2 FY26 – As of November 2025)** | Metric | Value | |-------|-------| | **Assets Under Management (AUM)** | ₹7,038 crore | | **Quarterly Disbursements** | ₹1,298 crore | | **Total Income** | ₹433 crore | | **Profit Before Other Provisions (PPOP)** | ₹89 crore | | **Net Interest Margin (NIM)** | **10.85%** (indicating strong core lending profitability) | | **Gross NPA** | 4.61% | | **Net NPA** | **0.38%** (exceptionally low) | | **Capital Adequacy Ratio (CRAR)** | **31.31%** (robust regulatory capital position) | | **Net Worth** | ₹1,918 crore | **Client & Operational Scale**: - **Active Clients**: 25.77 lakh (2.58 million) - **New Loans Issued (Quarter)**: ~2.25 lakh - **New Clients Added (Quarter)**: ~75,000 - **Average Loan Ticket Size**: ₹54,200 - **Branch Network**: 1,545 branches --- ### **Key Financial Trends & Milestones** | Period | AUM | Branches | Clients | |--------|-----|---------|--------| | **Sept 2024** | ₹11,571 crore | 1,463 | 38.5 lakh | | **Mar 2025 (FY24)** | ₹11,476 crore | 1,297 | ~4 million | | **Jun 2025** | ₹7,688 crore | 1,560 | 28.5 lakh | | **Nov 2025 (Q2 FY26)** | ₹7,038 crore | 1,545 | 25.77 lakh | *Note: Fluctuations likely due to refinancing cycle, data reporting variations, or temporary portfolio adjustments.* --- ### **Technology & Digital Transformation** Fusion has been **cloud-native since 2013**, operating on a **multi-cloud strategy** balancing scalability and data security. #### Core Tech Platforms: - **Shakti**: Proprietary core banking platform (cloud-based), supporting end-to-end **paperless, single-visit onboarding** via **webShakti** (web) and **mShakti** (mobile). Device- and OS-agnostic. - **FinDost**: In-house **Loan Origination & Management System (LOS/LMS)** for the MSME vertical. API-enabled, modular, and scalable. Future updates will integrate **AI-driven credit scoring** and real-time dashboards. - **Ground Reporter Module**: Enables real-time field activity tracking and lead management. #### Innovation & Security: - **AI/ML**: Used in credit scoring, underwriting, compliance, and customer segmentation. - **Self-Service Analytics Platform**: Empowers internal teams with data visualization and insight generation. - **Robust Cybersecurity**: - SASE, EDR, DLP, SIEM, VAPT, encryption, mobile device management - Secure-by-design, cloud-native architecture #### Digital Collections: - **Digital collection efficiency**: **92.46% in FY25** - Integrated with **Bharat Bill Payment System (BBPS)** - >90% collections via **NACH/eNACH** --- ### **Market Presence & Growth Trajectory** - **Geographic Reach**: 22 states + 3 UTs - **Branch Expansion**: - FY15: 75 branches → **9M FY25**: **1,506 branches** - CAGR in branch growth: ~20.8% (FY19–FY24) - **Client Growth**: - From **619 clients (2010)** to **over 4 million active clients (2025)** - ~11% average annual growth in client base over past 5 years - **AUM Growth**: ~**24–34% CAGR** over the past five years (varies by reporting period) - **Regional Distribution**: - **North (36.9%)**, **East (38.9%)** – High concentration in **UP, Bihar, Rajasthan, Odisha** - No single state exceeds 23.6% of AUM --- ### **MSME Vertical Deep Dive (Aug 2025 / H1 FY26)** - **AUM**: ₹673 crore (Mar 2025) - **Disbursals (FY25)**: ₹349 crore - **Branches**: 105 - **Employees**: 580 (as of Mar 2025) - **Secured Loans**: ~90% of book - **IRR**: ~22% - **Loan Approval Rate**: 50% - **Average Tenure for Field Leaders**: 3+ years - **Governance**: Each branch has at least one non-sales employee - **Priority Sector Lending (PSL)**: **100% of MSME portfolio qualifies** --- ### **Funding & Risk Profile** - **Diversified Funding Sources**: Including banks, NBFCs, and institutional investors - **Prudent ALM Policy**: Longer-term liabilities vs. shorter loan tenures; minimal maturity mismatch - **Credit Ratings**: Consistently rated **'A+' or equivalent** (CRISIL, ICRA, CARE), though some on **negative watch** - **Rating Upgrades**: **Three upgrades in the past five years** - **Cost-to-Income Ratio**: - Improved by **2,675 bps between FY19–FY24** - Reflects **growing operational efficiency** --- ### **Strategic Initiatives & Future Outlook** 1. **Product Diversification**: - Expansion into **solar rooftop financing** - Launch of **"Humara Fusion"**, an industry-first **rural customer loyalty program** to reinforce JLG model and repayment behavior 2. **Geographic Expansion**: - Deepening presence in **UP, Bihar, MP, Rajasthan** - Entered **Andhra Pradesh and Telangana** in FY24 3. **Human Capital**: - Focus on **employee upskilling**, strategic hiring, and **local recruitment** for MSME units 4. **Technology Roadmap**: - Full digital integration of **AI/ML in underwriting** - Enhancing **real-time monitoring** via **Audit 360** --- ### **ESG & Social Impact** - **Financial Inclusion**: Core mission to serve bottom-of-the-pyramid women entrepreneurs - **Gender Focus**: 100% women clients; mandatory female co-applicant in MSME loans - **Financial Literacy**: Integrated into all customer touchpoints - **Sustainability Initiatives**: - **Project Beej**: Supports rural women in starting agricultural ventures (e.g., mushroom farming in UP) - Clean energy financing (solar)