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Monday, November 29, 2021
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There’s no business like agribusiness

Yes Bank is one the few private sector banks to have a dedicated agribusiness team, which has benefitted the bank, helping it capture a large chunk of the country’s agricultural lending business, says Rana Kapoor, the bank’s founder and CMD, in an interview with Smart AgriPost

 

 As the founder of YES BANK, are you satisfied with its progress and ‘March Forward’, so far?

Ans:-The last 5 years of our 11-year journey has seen YES BANK growing from a small sized bank to a , achieving robust financial performances and business outcomes.

In the third and current phase of growth, we want to become a large bank in India by 2020. The strategy will include consolidating the bank’s presence in existing strongholds like Corporate and SME banking, while significantly pushing the Bank’s presence in Retail and augmenting the overseas foray with a measured approach.

Successfully building an institution is a highly satisfying endeavor; and though we still have many miles to go before we rest, with over 630 branches and over 11,000 YES Bankers, the journey so far has been extremely exciting and rewarding to say the least.

What are the main priority sectors of YES BANK for financial lending and why?

Ans:-These are sectors where YES BANK has built differentiation as a key strength. The bank has been able to face the onslaught of the global crisis, and demonstrate to markets — both domestic and international—that it can raise capital from quality global investors.

In addition to this, as we enter the next stage of growth, our focus will be on growing our retail portfolio with granularity. We have already adopted a measured approach to ramp up our retail presence and offerings across the country and we intend to ramp this up further.

Could you tell briefly about YES Bank’s loan Policy  for Agriculture and allied sectors?

Ans:-Agriculture is among YES BANK’s priority areas of lending. Our ARB (Agribusiness and Rural Banking) Division is empowered to create banking opportunities within the agribusiness domain. The team, comprising of experienced industry and banking professionals with relevant domain knowledge and skills sets in identified focus sectors, interacts with Food & Agribusiness clients and creates structured lending propositions for supply chain participants – farmers as well as SMEs.

There is a focus on various intermediaries in the F&A supply chain, ensuring an access to structured and financially appropriate banking products. Given the critical need for additional agri-infrastructure assets in the country, YES BANK took the lead in providing long-term structured term funding for related projects. Our in-depth knowledge of Priority Sectors has enabled us to deliver efficient and customized banking solutions to the core sectors, such as agriculture, dairy and sugar, among others.

Why did you choose agriculture as core area of banking?

Ans:-India’s economy is predominantly agrarian; with agriculture and allied industries contributing 18.2% (FY 2013-14) to the country’s GDP. We strongly believe in the immense potential of Farm Mechanization and Technology Interventions in Agriculture Sector aimed towards augmenting productivity in Agri and allied sectors, thus making Indian Agriculture competitive on Global parameters.

Consequently, we chose agribusiness as a focus sector, given the potential for growth and its multiplier impact. Since inception, we have believed in leveraging Knowledge Capital as one of the key differentiators to develop innovative, superior and sustainable financial solutions, based on efficient product delivery, industry benchmarked service levels and strong client orientation to reinforce long-term and sustainable partnerships with stakeholders. With these objectives in mind, the ARB was empowered to create banking opportunities within the agribusiness domain.

Agribusiness has been one of the core focus areas for the Bank since its inception. We follow an ‘integrated solutions’ approach of advisory, financing and hand holding during the implementation stage.

What have been the key highlights of Yes Bank’s differentiated approach in Food and Agri space?

Ans:-We recently entered into a strategic agreement with the Australian Trade Commission (Austrade), to mutually collaborate in business alliance and co-operate on information-sharing and business development, syndications, lending, trade finance and remittances among other areas. Under this MoU, Yes Bank also organized a dairy delegation to Australia last year. The delegation comprising key people from cooperative and private dairy sector companies aimed at facilitating cooperation between India and Australia in the areas of Agri-Dairy business services.

We also entered into strategic partnership with the Netherlands Agro, Food & Technology Centre (NAFTC) – India, a nodal Dutch agency, to work towards the development of farming communities, agri infrastructure, agro based industries and skill development initiatives across agri and allied sectors.

On the domestic front, YES BANK partnered with the Ministry of Food Processing Industries to organize a National Conference on “Spurring financing and investments in the food processing sector in India”. As a part of this event we released the “Fruits and Vegetables maps of India” – a highly appreciated knowledge document for the industry & Government alike, on planning targeted supply interventions for production, processing, cold chain, logistics & distribution functions in this much ignored high potential sub-sector.

What are the Bank’s innovative products for farmers engaged in Agri-Allied activities like dairy?

Ans:-The Indian dairy sector is estimated at $70 Billion, with the livestock sector contributing 28-30% to agricultural GDP and contributing 70% to livestock GDP. Given the dairy sector’s importance in the rural economic landscape, YES BANK had launched the YES Kisan Dairy Plus as a comprehensive suite of financial products for the dairy sector.

In the first phase of implementation, the Bank has collaborated with one of the largest dairies in South India. An automatic milk testing machine installed at the partnering dairy can provide immediate inputs on the quality and quantity of milk supplied by the small dairy farmer, who can be paid immediately through YES Kisan Diary Plus, into his saving account. The farmer receives a confirmation of payment through a mobile text message, and has two options to either leave the amount in his account or make withdrawals using YES SAHAJ, the Bank’s mobile ATM solution.

What is the bank’s policy to finance food processing industry?

Ans:-We are a leading private player with active participation in the development of India’s Food & Agri space and also own a robust and healthy portfolio in the food processing sector, especially in plantation crops, sugar, edible oils, milk processing and confectionery. Our expertise includes project funding, technical and administrative project support, infrastructure financing, consultation support for backward – forward integration, credit funding for entire food supply chain.