As farm sector gains importance, HDFC Bank reworks strategy for rural areas

With farm sector becoming key sector for economic growth, HDFC Bank is reworking business strategy for rural area and adding 100,000 village level entrepreneurs (VLEs) to push products such as gold loan, personal loan and loan against property.

The country’s largest private sector lender has commenced work on the rural phase of ‘Summer Treats’, a plan that attempts to meet the changing needs of merchants, salaried and self-employed customers. Both retail as well as business customers can avail of discounts on processing fees for loans, and reduced EMIs.
 

Efforts to curb the spread of Covid-19 have changed consumer lifestyles and demands. Work from home and school from home have resulted in increased demand for phones, tablets, computers and related accessories, the bank said in a statement.

As of March 31, 2020, the bank’s distribution network had 5,416 banking outlets. Out of them, 52 per cent were in semi-urban and rural areas.

In a major restructuring exercise, the State Bank of India has also created a separate business vertical to focus on financial inclusion and micro-markets (FI&MM) in semi-urban and rural areas.
 

The demand for safe digital payments and private transport is also rising. Similarly, as shops and businesses begin to reopen, they have requirements for business finance.
 

HDFC would work through the network of 100,000 VLEs enrolled with the government's Common Service Centres (CSC). Both retail as well as business customers can avail of discounts on processing fees for loans, and reduced EMIs. In July 2018, HDFC Bank and CSC SPV signed an MoU to enable VLEs enrolled with CSCs to offer banking products and services in remote locations.