Another NBFC from the Muthoot family is planning big, with the gold loan business doing well because of the pandemic. Kerala-based Muthoottu Mini Financiers (MMFL) has plans to open 100 branches across the country, and is targeting a 75% growth in assets under management (AUM) in the current fiscal, Mathew Muthoottu, managing director of MMFL, said.
MMFL had closed nearly 100 branches in 2019 and was in a consolidation phase after lagging way behind Muthoot Finance and Muthoot Fincorp in book value and AUM.
“Gold loan business is looking very good at this point of time due to the uncertainty as people need money and banks are not willing to lend. After the first lockdown, people wanted money to restart their trade, small shops and business, etc. Going forward, we believe gold loan has an essential part in servicing immediate capital requirement before banks come in,” Mathew Muthoottu said.
The gold loan NBFC achieved a growth of 40-50% in the last fiscal in spite of 2-3 months of complete lockdown.
MMFL has currently four lakh active customers, predominately from rural and semi urban areas.
“Before 2020, we were in a consolidation phase and closing down loss making branches. Now, we are planning to increase our branch network to 900 from 806 in this fiscal and gold loan AUM of Rs 3,500 crore from the present level of Rs 2,000 crore,” he added.