Mumbai: The subsidiary of Singapore government-owned fund Temasek, Fullerton India is proceeding impressively and making its presence felt in the country where other multinational non-banking finance companies (NBFCs) have gone slow on their retail loans.

Founding its 500 branches, Fullerton India offers the largest branch network in the country. Furthermore, Fullerton is planning to double its network next year, while most of the other main players have slowed down in setting up their branches, since this was turning out to be an expensive option.

One of the largest NBFCs in the country, Citi Financial has 480 branches across 165 cities, and GE Money has 180 branches, which they have been operating for the past 7 years. Mahindra Finance has the largest network of 425 branches, while others, such as Sundaram Finance have less than 200 branches.

The Singapore-based Chairman of Fullerton India Credit Company, Francis Andrew Rozario is appearing to be betting big on Indian retail loan market. According to the Chairman, set up 2 years ago, Fullerton India would double its branch network to 1,000 and the loan business to Rs 5,000 crore within next one year. The company has drawn up a new business model to tap the rural market, which is largely catered to by moneylenders.

Rozario, also the CEO of the Fullerton Financial Holdings, Singapore, the parent company of Fullerton India, told that their company had already invested $150 million (out of the committed $300 million) in India and would bring in the balance next year.

“Sometimes, MNCs have a scale dilemma. It’s the only business which we are doing. They (other MNCs) are also there in the banking segment. We are entering a segment which is relatively under served. Scale is very important to us,” said Rozario, on the question of the aggressive branch rollout compared with other MNC NBFCs.

Rozario also said, “We have emerged as India’s fastest growing financial service company with 500 branches in 215 locations and employing 10,000 people. We have disbursed Rs 2,500 crore so far and hope to double it in the next one year.”

“We are also looking at how to take our model into semi-urban and rural India. There are six lakh villages, and at least, 6,000 villages have a population of more than 50,000. We will start off our pilot to test the rural model next year. The Indian NBFC has a committed capital of $300 million from the parent company, of which it has already invested $200 million. It also has around 10,000 employees making it the largest employers in the NBFC segment.” Mr Rozario added.

Fullerton India Credit MD & CEO GS Sundararajan said, “We have a customer acquisition rate of 20,000 per month and this is likely to be scaled up to over one-million customers per annum. We have disbursed around Rs 2,500 crore and will double our disbursements next year. We will break-even sometime next year.”

While most of the other NBFCs use direct-selling agents for sourcing customers, Fullerton mainly focuses on customers within a 5 km of its branches and taps both self-employed and salaried classes.

Sundararajan, Managing Director and CEO, . “We currently have a customer acquisition rate of 20,000 per month and this is likely to get scaled up over one million customer per annum by the end of next year.”

According to the CEO, the company has an NPA of 1.5 per cent, which is lower than the average 3 to 4 per cent in the industry. The loan size ranges from Rs 1 lakh to Rs 5 lakh.

Planning to double its branch network next year, Fullerton India Credit Company is a wholly owned subsidiary of Fullerton Financial Holdings, Singapore. Acquiring an 84% stake in Chennai-based Dove Finance in late 2005, the company started its pilot phase in April 2006 with 24 branches. It began rolling out of branches after it completed its test phase in November 2006.

What’s more intersecting, Fullerton is acting aggressively when most other NBFCs are having a relook at their retail portfolio because of rising delinquencies. The company doesn’t appear to be facing the same problem. Mr Sundararajan articulated that the credit losses were only 1.5% against an industry average of around 10% in the segment.