Janalakshmi Financial Services appoints Ajay Kanwal as new CEO
Mumbai: Bengaluru-based Janalakshmi Financial Services on Monday named Ajay Kanwal, former head of South Asia at Standard Chartered Bank, as its new chief executive officer. The microfinance company is in the process of becoming a small finance bank.
Kanwal will take charge on 1 August and move to Jana Small Finance Bank subject to approval from the Reserve Bank of India (RBI). Currently, V.S. Radhakrishnan is the CEO of Janalakshmi Financial Services.
“I am excited about this opportunity. It provides great opportunity to serve the space of emerging mass affluent customers,” Kanwal said over the phone.
Currently, Kanwal is a senior adviser to private equity firm TPG Capital and global payments company Mastercard. TPG is an investor in Janalakshmi Financial Service.
Janalakshmi was among 10 applicants to receive RBI’s in-principle approval to start a small finance bank in September 2015. In April, it got the final approval for the bank.
Except Janalakshmi and RGVN Microfinance (North East) Ltd, all other small finance bank licence holders have started operations.
Kanwal said a soft launch of the small finance bank is scheduled by the end of 2017 and that the bank will aim to have 300 branches in the first half of 2018.
Earlier, the bank announced that it will launch in the second quarter of current fiscal.
One of the reasons for the delay in launch is the ongoing fundraising plans of the lender. Kanwal did not comment on this.
Janalakshmi is in talks with investors like Goldman Sachs and Credit Suisse to raise Rs1,000-1,200 crore, Economic Times reported on 19 June.
Kanwal said the bank has to be cost-efficient to provide services to the mass affluent of India and that is reason why Jana Small Finance Bank will be “very digitised”. He added that the focus on serving bottom-of-the pyramid customer remains, along with good governance and risk management practises.
Like other microfinance companies, Janalakshmi has been affected by demonetisation. Kanwal said that this does not alter the banking plans. The rise in delinquencies “post-demonetisation does not take away the potential of giving loans to group of customers or small businesses. The business case is intact. There is just a bump on the road, which needs to get sorted out”, he said.