You had mentioned plans to evaluate a credit card product, given that many competitors are expanding into that space. Any updates?
We are closely observing customer demand in that segment. Credit cards are largely a volume-driven business. At present, our customers already enjoy strong transactional facilities through digital banking and debit cards. While we are evaluating the product, we are not planning a credit card launch in the near term.
How did the MSME segment perform, especially given the US tariff-related disruptions in some sectors?
Our MSME portfolio continues to perform well. It grew 11 per cent quarter-on-quarter (Q-o-Q) and 33 per cent year-on-year (Y-o-Y) as of September. Net non-performing assets (NPAs) in this segment declined from 1.5 per cent to 1.2 per cent. Sectors affected by the US tariff regime have minimal exposure in our book. Our MSME clients are mostly in diversified domestic markets, with an average ticket size of around ₹25 lakh. Hence, we haven’t seen any significant impact.
On the retail side, are you seeing traction in auto and two-wheeler loans post-goods and services tax (GST) rate cuts?
We are not heavily into auto or two-wheeler financing except for customers who already have a relationship with us. However, during the festival season, we are seeing encouraging traction from that segment.
How is your housing loan portfolio performing?
Housing loans account for around 12 per cent of our total portfolio. With interest rates stabilising, we see good opportunities in semi-urban and smaller urban centres.
Most of our housing finance is construction-linked. The mortgage book grew 6 per cent Q-o-Q and 22 per cent Y-o-Y. Going forward, loan against property (LAP) will be the main growth driver, supported by housing loans.
Agriculture remains a large part of your portfolio. How did it perform in Q2?
Agriculture contributes about 30 per cent to our total advances. Despite natural calamities in parts of the country, our asset quality has held up well, with net NPAs declining and no major write-offs. We recorded about 6 per cent Q-o-Q growth, though Y-o-Y growth was muted. Q3 generally sees higher recoveries due to the harvest and cash-flow cycle, and we expect the trend to continue this year.
What are your current branch expansion plans?
We currently operate 200 branches and recently opened our second branch in Chandigarh. Another 28 branches are in the pipeline — eight-nine in Haryana, five in Rajasthan, and two in Uttar Pradesh, which will be a new market for us.
One of your peers recently received approval to transition into a universal bank. Are you planning something similar?
At this stage, our focus is on scaling up within the small finance bank framework. We aim to double our advances book from ₹7,900 crore to ₹16,000 crore by FY29. Once we achieve that scale, we will evaluate applying for a universal bank licence at an appropriate time. We are not in a hurry; growth and stability remain our priorities for now.
 "Sarvjit Singh Samra, managing director (MD) and chief executive officer (CEO), Capital Small Finance Bank")