Leveraging our strengths

Bringing our vision
to fruition

Since our inception, we have focused on building a differentiated business model of doing small ticket, secured retail loans for income generation. Now, as a Bank, we are extending the same philosophy for building our deposit franchise with a focus on granular retail deposits.

We continue to strengthen our product range and value proposition in retail loans given our domain experience. The share of retail loans at ~84% of total loans is one of the highest among private sector banks. We expect growth in this segment to remain healthy with new product offerings and geographic expansion. While wheels (vehicle — new and used) and MSME loans remain our core retail asset products, home loan has been gaining greater importance as well. Further, gold loans, digital solutionbased products — personal loans and consumer finance — are seeing healthy traction.

Our loans are largely for income generation purposes to selfemployed and low and middleincome groups and are secured by way of underlying assets. To maintain independence and leverage functional expertise, within each business vertical there are separate sub-teams for sales, underwriting and credit, collection, operations, among others.

We are committed to further scaling up our retail asset book by sticking to our first principles and focusing on ‘essentials/consumption/ local economy businesses’. We will look to add more touchpoints through contiguous expansion, and explore opportunities to open BCs/BOs in the unbanked areas to deepen our presence in our existing geographies. We seek to capitalise on our deep understanding of local markets and local businesses and replicate our strong underwriting and collections capabilities as we expand further. We aim to continuously tweak our loan product portfolio to adapt to our customers’ needs while increasing our engagement with them on the liabilities side.

We are emulating the retail orientation for our Liability business as well. At AU Bank, there are separate teams for Retail, Wholesale, Government and FIG Customers which allows greater and measurable focus on each segment. The Bank has clearly identified the basic utility and differentiated product propositions keeping in mind customer preferences across deposits, payments, investments, insurance, credit cards, forex, lockers and others. The focus here is also on granularity, small ticket size and retail.


CAGR of retail assets AUM over last five years (from FY 2015-16 to FY 2019-20)


Contribution from retail loan products

5-year CAGR of Wheels and SBL-MSME AUM


In less than three years, we have built a deposit base of ` 26,164 crore, which stands out among SFBs in terms of granularity and branch productivity. We are strengthening this franchise with an ‘acquire, activate, transact and deepen’ strategy. Retail term deposits and Savings Accounts accounted for 29% and 10% of total deposits in FY 2019-20 vs. 21% and 13%, respectively, a year ago.

We have bolstered our digital platform to fortify the liability franchise with field agents equipped with tabs which enables them to open accounts without requiring any physical documentation.

During the year, we became the first Bank to launch WhatsApp Savings Account opening facility which allows all our prospective customers to seamlessly open Savings Account with us by simply initiating a chat on WhatsApp. We also launched our premium contactless debit card offering during the year called ‘AU Royale’, which is a best-in-class debit card product in its segment. We believe that AU Royale will increase our ability to compete in the well penetrated high value urban customer segment.

To enhance the user experience of our current as well as prospective depositors we revamped our website and also added a chatbot called ‘Auro’, which provides convenience to the customers along with ease of access.

To engage with our depositors we went live on Bharat Bill Payment System (BBPS) to enable customers to make online bill payments and also launched the ASBA module which allows our customers to apply for Initial Public Offerings.

We have also taken several initiatives to improve brand visibility. During the year, our digital campaign #BharosaApnoJaisa delivered more than 12 crore impressions and we also started our ads on prominent FM radio channels across large cities.

On the liabilities side, we strive to be among the most preferred banks in non-urban markets, where we have a well-established presence, by deepening our connect with the ecosystem, and be among the top three banks in terms of market share in the next two years.

For urban markets, we aim to carve out our niche by providing best-in-class product and service offerings and growing our branch presence in super metros including new urban markets, and deepening our presence in existing markets.

We have built a base of 1.7 million customers and are gradually expanding the same. Now, the focus is on increasing our per customer wallet share via higher cross-selling. Our products per customer stands at 1.3x vs. average 4x for large private banks, which provides substantial headroom for growth for cross-selling.