September 25, 2022


Today, we are quite prepared for that eventual transition to a cashless economy. Cash disbursement of our gold loans takes place only up to a limit of 1 lakh rupees beyond which we have been using NEFT. In fact, even before demonetisation, about 50 percent of our gold loans by value were disbursed through NEFT. We are aggressively promoting the online repayments of interest and principal as also our Online Gold Loan (OGL) product which is totally cashless at our end. A customer has to come to our branch only once to deposit his gold and execute necessary documents. After that, he can avail a loan up to his eligibility anytime, from anywhere in the world using a smart phone, computer, or other internet enabled devices. The loan proceeds are instantaneously transferred to his bank account. Even after repayment, the gold will continue to remain with the Manappuram branch for future loans to be availed online.

 The move towards a cashless economy with digital payments taking over will open up many new opportunities in the Fintech area. We are developing new age gold loan based Fin Tech business opportunities. We have started implementing new technologies like Net Lockers, Mobility solutions, eKYC, digital wallets etc. so that our customers will be able to access all our products and services through their smartphones.

Necessity being the mother of invention, we will see much faster adoption of technology at the customer level. A recent note put out by Goldman Sachs says demonetisation will give meaningful fillip to electronic transactions in the longer run implying further market share gains for banks with strong technology based offerings. We are not a bank as yet but as an NBFC with a strong suite of technology based offerings of our own, and with ambitious plans in the Fintech area, we are very well placed to tap into the opportunities and potential. Indeed, for gold loan NBFCs who have invested in cutting-edge technology, I would say the outlook is brighter now than ever before.

Author: V.P. Nandakumar is MD & CEO of Manappuram Finance Ltd. and Chairman of the Kerala State Council of CII.


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