DBS Bank India is aiming for a $1 billion SME loan book milestone by December 2025, Divyesh Dalal, MD & Head of Global Transaction Services at DBS Bank India, has said.
Currently, DBS Bank India’s SME book, primarily built digitally, stands at about ₹5,000 crore, experiencing a CAGR of 40 percent over the last three years.
“Our SME loan book has started growing only in the last three years. This is all in the last three years, and we started during the pandemic,” Dalal said in an interview.
“SMEs are pivotal to our growth in India. The fact that Lakshmi Vilas Bank amalgamated with DBS Bank India in November 2020, and the fact that we keep investing in technology and integrating ERPs like Tally are all pieces of evidence that we clearly believe there is a big play for us in the SME sector.”
Dalal also expressed confidence that DBS Bank India would be able to sustain the 40 per cent growth rates in its SME book in the coming years.
“As the loan book expands, achieving a 40 per cent growth rate on a larger scale would be truly phenomenal. We would love to do even more. We are confident that we would be able to achieve the same rate (40 per cent) of growth”, he said.
Dalal sees supply chain financing as the biggest growth driver for the SME book. “Our supply chain finance book will help us achieve deeper penetration among SMEs. Currently, there are 4,000-5,000 suppliers on the supply chain program who get financed through our programs with the anchor”
DBS Bank India also plans to leverage data in a more significant way to provide products and services to SME customers more effectively to meet their unmet needs, he said.
Going forward, DBS Bank India is also looking to scale its instant loan facility—a product provided by the bank in other markets — in India for the benefit of SMEs here, Dalal added.
Currently, DBS Bank India partners with NBFCs for co-lending initiatives. “Through these partnerships, our aim is not only to expand our customer base but also to provide banking products that are beyond the offerings of NBFCs, such as Letter of Credit (LC), bank guarantees, and cross-border forex solutions,” Dalal said.
Asked to spell out the focus areas for DBS Bank India in coming days, Dalal said that the bank would keep investing in digital; significantly increase the number of partnerships not only for acquiring customers but getting data to identify what’s good or bad in terms of lending and leverage bank’s own supply chain database to lend more for same trade transactions (for post shipment how can we provide pre shipment financing).
On the ongoing initiatives around ONDC, Dalal said that it was an important play for the bank as it would help not only in customer acquisition but building a granular book on the liability as well as asset side.
As featured in The Hindu Business Line
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