AFTER the Centre announced credit relief, Jalandhar-based Midland MicroFin Ltd is waiting for the scheme to take shape and offering loans to small companies. Amardeep Samra, managing director of the Rs1,000-crore microfinance company, talks about the business in an interview with Deepkamal Kaur. Excerpts:
How have your offices been functioning since the lockdown? Have you assessed your losses?
For the first two months, our business was almost shut. We started working in mid-May after MHA guidelines. Some of our branches in Rajasthan, which are in the red zone, are still shut. At our head office in Jalandhar, only 33 per cent staff are attending the office daily on a rotation basis and the rest of them are working from home. Our employees who have been using public transport to reach offices from their villages or peripheral towns are discouraged from coming to the office as of now. Covid-19 impacted us when there was just a week or so for the previous financial year to close. The actual assessment will be assessed when we make financial statements for the first and the second quarters of FY 2020-21.
Has the lending business resumed? Who are your clients?
No, we have not started our credit business as of now. We are awaiting the Centre’s credit-giving guidelines. We are in touch with government agencies, including NABARD and SIDBI, and will start offering credit to our customers as and when the process starts. In such a scenario, people obviously need liquidity to restart their businesses. We have a customer base of 4 lakh people. Fortunately, 60 per cent of our customers are from the businesses that fall under essential services such as milk vendors and grocery shop owners. Thankfully, they have cash flows with them even in these tough times. There are other sections of customers, including small boutiques in villages, micro enterprises and some joint liability groups.
Are you getting loan repayments? Who are your depositors?
We extended moratorium to our customers but still a few of them started paying in advance. Moratorium has an interest portion which the government has not waived. Since the customers feel that they will have to pay the interest, they are not going for moratorium. Besides, our loan size is very small, say around Rs30,000-Rs35,000. We are a non-deposit accepting entity. We borrow money from public sector banks, NABARD, SIDBI and some private banks.
Are your employees intact? Are you paying wages to them?
We have 197 branches in seven states — Punjab, Haryana, Rajasthan, UP, Jharkhand, Bihar and Himachal Pradesh — where 1,700 employees are working. They are all with us. We have paid salaries to all our employees, including those who have not worked for over two months.
Being a private limited company, how are you maintaining the trust of your shareholders?
We have a diversified share holding. We have 250 share holders. We are one of the 100 micro-finance companies pan India which are registered with the RBI. We keep holding board meetings and we have one in this week as well. They all know that we work totally under the regulations of the RBI. For customers, we have a helpline and our staff keeps on interacting with them.
How have you helped the community in these days?
We paid Rs2 lakh to the Deputy Commissioner's welfare funds. We distributed masks and PPE kits not just to our staff but also our customers who were frontline warriors.
What lessons have you learnt during the pandemic?
Not just us, every company has learnt a lesson that it is the need of hour to be prepared for an unprecedented crisis. We need to have policies to keep ourselves prepared for any natural calamity, which can happen any time. I spent a lot of time with my family. My both children were in the UK and they returned in the second week of March.
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