### **Overview** Jana Small Finance Bank Ltd, established as a scheduled commercial bank in March 2018 after transitioning from an NBFC-MFI, has evolved into the **4th largest Small Finance Bank in India**. With over **16 years of lending experience**, the bank serves a diversified customer base of **over 12 million customers** across **25 states and 2 union territories**, operating through a network of over **800 branches**. The bank is strategically positioning itself as a full-service digital anchor bank focused on **sustainable growth, financial inclusion, and digital transformation**. --- ### **Strategic Pillars & Vision** The bank operates under a **“Sprint 7.0” strategy**, aiming to become a **secured, digital, and anchor bank** that delivers end-to-end financial solutions to self-reliant individuals and small businesses across India. This is anchored by its **“Home 360” platform**, which uses home loans as the primary entry point to cross-sell a suite of financial products over the customer’s life stage. Key strategic goals include: - Transitioning from a small finance bank to a **Universal Bank** (application filed in Aug 2025). - Achieving **>80% secured assets** in its loan book. - Deepening **customer lifetime value** through multi-product engagement. --- ### **Business Model & Segment Focus** Jana SFB serves a wide spectrum of customers: - **Affordable housing** and **Micro LAP (Loan Against Property)** borrowers - **MSMEs**, **micro-entrepreneurs**, **rural communities**, and **digitally native urban users** - **HNIs, NRIs, and Senior Citizens** via premium programs - **Underbanked and unbanked populations** through microfinance, agri loans, and business correspondent (BC) models The bank has shifted focus post-COVID from aggressive urban microfinance toward **rural lending, secured loans, and deeper personalization**, particularly through upgrading reliable group borrowers to individual loans. --- ### **Lending Portfolio (Key Metrics as of FY24–FY25)** | Segment | AUM (₹ Crore) | Growth (Y-o-Y) | Key Features | |--------|----------------|----------------|--------------| | **Affordable Housing** | ₹6,136 | 29–38% | Avg. ticket: ₹11 lakhs; tenure: 213 months; GNPA: 1.4% | | **Micro LAP** | ₹5,764 | 29–38% | Avg. ticket: ₹6.3 lakhs; LTV ≤50%; GNPA: 0.7% | | **MSME Loans** | ₹4,304 | 27% | Mortgage-backed, overdrafts, inventory financing; avg. ticket: ₹34 lakhs | | **Gold Loans** | ₹980 | **238%** growth | Secured, collateralized lending; portfolio expanding rapidly | | **Two-Wheeler Loans** | >₹1,000 crore | Exponential growth | Unique **100% LTV** model via cross-collateralization with housing/Micro LAP | | **Microfinance (MFI)** | ₹8,913 | ↓11% YoY (due to industry stress) | Individual Loans ↑6%, Agri ↓43%; 53% repeat borrowers | | **NBFC Lending** | ₹1,987 (~6–7% of book) | Stable | Non-delinquent for 7 years; tactical, not core | | **Supply Chain Finance** | ₹597 | 72.3% growth (YTD) | Dedicated platform in development | > 💡 **Portfolio Composition:** > - **70% of total loan book is secured** (up from <5% six years ago) > - **Unsecured loans:** ~30% of portfolio, primarily microfinance > - **CASA-linked lending:** 99% of housing and Micro LAP customers maintain CASA accounts --- ### **Funding & Deposit Franchise** Jana SFB has built a **robust retail deposit base** with strategic emphasis on **low-cost, stable, and retail CASA growth**. #### **CASA Performance** - **CASA Growth (YoY):** 18% (May 2025), outperforming industry trends - **Average CASA Balance (Housing & Micro LAP):** - **₹24,500** (Oct 2025), down from **₹27,600** in prior months - Previously rose from **₹18,000 to ₹28,000** (May 2025), indicating volatility due to seasonal or strategic rebalancing - **Mature Branches (4+ years):** Average deposits surge from ₹3Cr to **₹19Cr per branch** #### **Deposit Products & Initiatives** - **“Liquid Plus FD”**: Short-term, high-liquidity FD; strong adoption - **Legend Account**: Zero-fee, high-interest savings for **senior citizens**; monthly payouts; 3x average ticket size - **Exclusive & Premier Programs**: For HNIs and NRIs; supported by 121+ dedicated RMs - **NRI Expansion**: New Exclusive and Premier NRI deposit variants launched > 📉 Despite industry-wide CASA contraction, Jana is **strategically reducing wholesale CASA**, focusing instead on **relationship-driven retail CASA** via branch expansion and targeted offers. --- ### **Cross-Selling & Customer Engagement** - **Avg. Product Relationships per Customer:** **3.9** (excluding insurance); up to **6.1** with insurance - **CASA Penetration:** **99%** in anchor segments (home loans, Micro LAP) - **Key Bundling Strategies:** - Two-wheeler customers offered **savings accounts, business loans, health insurance** - MSME/MFI customers cross-sold **gold loans, insurance, wealth products** - Pre-approved **business loans up to ₹5 lakh** within 24 hours for loyal customers - **Customer Tenure:** Average relationship duration increased from **3.6 to 3.8 years** (YoY) > 🔗 56% of loan assets come from **existing customers**; **33% hold >3 loans** --- ### **Digital Transformation** Jana SFB is a leader in digital innovation: - **Awarded “Leader in Digital Transformation Strategy” (2025)** - **Digital-first approach:** 92% loan originations, 98% transactions are digital - **Mobile App:** 4.6–4.7 rating; **registrations +59% YoY**, transaction volumes +53% - **Key Tech Initiatives (Aug 2025):** - e-Signatures, e-Stamps, real-time credit scoring - Automated CAM generation, image compression - **Droom API**: Real-time vehicle price verification - **Host-to-host ERP integrations** for corporate clients - **Active Directory-based secure authentication** > 🚀 Digital enablers include **12,000+ Merchant QR codes** (79% active), driving CASA growth and digital transactions. --- ### **Risk Management & Portfolio Quality** - **GNPA:** **2.7%** | **NNPA:** **0.9%** (FY24–25) - **Asset Quality:** - **Affordable Housing:** GNPA 1.4%, NNPA 0.7% - **MSME & Micro LAP:** Conservative LTVs (≤50%), strong performance - **Credit Guarantee Schemes:** - **CGTMSE & CGFMU**: 28% of MFI book covered; targeting >90% by Sep 2025 - **Scorecards:** Proprietary, internal risk-scoring models for all key products; override bureau scores where appropriate - **New 3rd-gen scorecard for Affordable Housing and Micro LAP launching soon** > ✅ Over **50–60% of loans are individual**, not batch-based; single-customer exposure capped at ₹1.25 lakh --- ### **Branch & Geographic Expansion** - **25 States Coverage** (as of May 2025); **180 cities** for core secured loans - **Top Markets:** Bangalore, Delhi, Mumbai, Kolkata, Lucknow, Indore, Gurgaon, Chandigarh - **Reduced Geographic Concentration:** - Top 3 states’ share: from 35% → **30%** - “Rest of India” share: **41% up from 32%** - **Branch Optimization Strategy:** - **Relocate** existing branches from asset-centric to deposit-centric areas - Can open up to **200 new branches** and relocate **209 existing ones** - 17 new branches opened, 39 relocated in FY24 - **Rural Focus:** 36.8% **Unbanked Rural Branch (URB)** ratio (vs 25% mandate); high profitability, breakeven in months --- ### **Regulatory & Financial Strength** - **CRAR (Capital Adequacy Ratio):** **20.7%** — well above regulatory minimum - **AD-I Licence:** Enables full **forex and cross-border services** for MSMEs, exporters, trade clients - **Asset Growth:** AUM CAGR of **24.9%**; **secured lending share now 60–70%** - **Credit-to-Deposit (CD) Ratio:** Improved by **640 bps** due to strong deposit growth - **Stable Funding:** >90% of retail and bulk deposits have maturity >1 year --- ### **Competitive Differentiation** | Factor | Advantage | |-------|-----------| | **Cross-Collateralization** | Industry-first **100% LTV on two-wheeler loans** (backed by home/Micro LAP loans) | | **Digital Origination** | End-to-end digital loans (microfinance, two-wheeler); 92% originations digital | | **Proprietary Scorecards** | Tailored to informal/semi-formal sectors; reduces human bias | | **Customer Progression Model** | From **group loans → individual loans → secured products** (housing, gold) | | **No Fintech Dependency** | Sources **99.99% assets internally**; maintains full control over underwriting |