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Kotak Mahindra Group announced that it has acquired the vehicle financing loan portfolio of Volkswagen Finance Private Limited (VWFPL), Volkswagen Group's Indian captive financing arm. It also said, Kotak Mahindra Prime Limited (Kotak Prime) will acquire the passenger cars and two-wheelers portfolio, and Kotak Mahindra Bank Limited (KMBL) will acquire the commercial vehicles portfolio of VWFPL.
With this, the company will gain access to over 30,000 high-quality customers with a total loan outstanding with VWFPL of around ₹1,340 crore.
The company in its regulatory filing said, all these acquired loans are classified as Standard Loans as per the current Reserve Bank of India (RBI) guidelines. In addition to the “Standard Loans", Kotak has also acquired the Non-Performing Assets portfolio of VWFPL.
D Kannan, Group President, Commercial Banking, Kotak Mahindra Bank and Director of Kotak Mahindra Prime, said, “The strategic intent behind this acquisition is to further strengthen Kotak’s vehicle financing loan portfolio and expand our market share. VWFPL has been operating in the country since 2009 and during this time has built a strong customer portfolio."
“The long-term growth prospects of the Indian vehicle market are very attractive and this acquisition reinforces Kotak’s standing as one of the leading vehicle financing players."
“I would also like to take this opportunity to welcome Volkswagen customers to the Kotak Group and assure them that they will experience a seamless transition and enhanced customer experience with access to a wide suite of product offerings, backed by exceptional service standards," added Kannan.
Speaking on the development, Aashish Deshpande, MD and CEO of Volkswagen Finance Pvt. Ltd. said, “The sale of our retail portfolio aligns to our new strategic focus towards a refined digital strategy through our subsidiary, the digital platform KUWY.
“It is a step towards the evolution of the customer journey in the digital space by offering a simplified and agile solution to both our customers and dealerships, while aligning effectively to support the VW India 2.0 strategy," he added.
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