Aditya Birla Capital sees digital platforms driving growth

The financial services arm of the Aditya Birla conglomerate has already launched two of these platforms. While Udyog Plus for small businesses was launched in May 2023, the direct-to-consumer (D2C) platform ABCD was launched in April. The third platform, meant for distributors and channel partners, will be launched in the next two-three months, said Pankaj Gadgil, chief executive of Aditya Birla Housing Finance, and head of digital platforms and payments strategy for Aditya Birla Capital.

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“The third platform is the B2D (business to distributor) platform. Aditya Birla’s strength also lies in the over 200,000 channel partners," said Gadgil, adding that these are mutual fund distributors, independent financial advisors and others. He said that the new platform would make onboarding simpler and faster. 

There are over a million customers registered on Udyog Plus and ABCD saw 800,000 registrations, as per information presented to analysts on 1 August. Mint reported on 16 April how the group is banking on ABCD, built at a cost of ₹100 crore, to nearly double its customer base in three years and keep pace with the expected growth in India’s financial services industry. Aditya Birla Capital is looking to add 30 million customers to its current base of 35 million over three years on the back of the ABCD platform.

Experience across segments

Gadgil, who worked at private sector lender ICICI Bank for close to two decades before joining Aditya Birla Capital in 2022, has experience across retail and business banking, small and medium enterprises, and payments.

“A couple of years back when all of us joined and we crafted our strategy of one customer, one experience, one team strategy, there were three important pillars to achieve that. These are data, digital and technology," said Gadgil. “We also saw that in the elements of digital, data and technology, we were under-invested both in terms of the people and architecture, and infra platforms." 

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The company then decided to create digital platforms and focus on specific customer segments. “First is the MSME segment. We all know the kind of unmet credit demand in that industry. Second, we picked up a segment where we feel that the inertia of trying out things is less."

Gadgil said the company chose to look at the so-called first-income to first-kid segment within retail individuals, estimated at 100-120 million in India. 

“So, a customer who started to earn more recently, and a customer who just got settled in his life and has a kid and is typically within the age group of 28 to 40 is what we looked at," he said.

Great expectations

Aditya Birla Group is not the only conglomerate with great expectations from the financial services business. Enthused by the pace at which Indian consumers are devouring credit, the Godrej group and Reliance Industries group have also tried to muscle their way into the non-banking financial services market and embark on a digital lending journey.

Also read |  Aditya Birla Capital, subsidiary Aditya Birla Finance to merge

Earlier this year, Aditya Birla Capital decided to merge Aditya Birla Finance Ltd with itself, helping its unlisted subsidiary skip the public-listing requirement ordered by the Reserve Bank of India (RBI). Aditya Birla Capital is listed, while its wholly-owned arm Aditya Birla Finance is among the 15 upper-layer non-bank lenders mandated by the RBI to go public by September 2025. Merging with the listed parent averts the need for the subsidiary to be separately listed.

Aditya Birla Capital said in a regulatory filing on Wednesday that the Reserve Bank of India has accorded its “no objection" to the merger.