IDFC eyes retail deposits for faster growth

IDFC, a leading lender to infrastructure projects in the country, aims to mobilise retail deposits in order to foster asset growth.

“I have to get some ways of funding if I have the ambition to be large...if balance sheet needs to grow faster, then we cannot depend on wholesale funding only,” Rajiv Lall, managing director and chief executive officer, IDFC, said.

Asked whether the company is eying retail deposits, Lall replied in affirmative. “We have discussed at the board that in order for us to grow to a Rs 100,000 crore, we have to find some other way of funding,” Lall said.

The company’s balance sheet size now is Rs 30,000 crore. However, he said IDFC had not discussed any specific issues with the Reserve Bank of India.

According to the regulations, IDFC is defined as a non-deposit taking systemically important non-banking financial company. To accept public deposits, that is to become deposit-taking NBFC, the company will need RBI’s approval.

The finance company is also planning to increase its exposure to the telecommunication sector. “At present, our exposure to the telecom sector is 5-7 per cent. We are looking to increase it,” Lall said without divulging further details. At present, IDFC’s exposure to power and transport is about 65 per cent of the total exposure, which will come down as focus on telecom goes up.

Lall also said because of the slowdown in economic activity new projects might not come up in the same speed as it happened in the past. “The risk appetite (of borrower) is coming down as a result demand is likely to slow down (in the next financial year),” he said.