Centrum Microcredit

Centrum Microcredit Limited operates as a Non-Banking Financial Company-Micro Finance Institution (NBFC-MFI) in India, concentrating on providing financial services to underserved and unserved women in urban, semi-urban, and rural areas. The company was established in 2017 as a step-down subsidiary of Centrum Capital Ltd. Its formation was catalyzed by the acquisition of the microfinance business from the South Africa-based FirstRand Bank in November 2017, a strategic move to acquire an existing team and customer base of around 70,000 in Maharashtra.

The business model is centered on the Joint Liability Group (JLG) framework, offering loans exclusively to women entrepreneurs and self-help groups. This approach is designed to foster income-generating activities, such as establishing or expanding small businesses, thereby aiming to improve the living standards of financially excluded women. The company's revenue is generated from the interest on these micro-loans. In November 2019, Centrum Microcredit expanded its portfolio by acquiring the business of Altura Financial Services. The company's leadership includes Chairman Ranjan Ghosh, who has extensive experience in the banking and financial services industry, and COO Praveen Saha, who brings over 17 years of experience in financial services and the microfinance sector.

Operationally, the company has a significant presence across India with 130 branches in 72 districts spanning nine states. To enhance efficiency, Centrum Microcredit partnered with PayNearby, a fintech platform, to digitize its cash collection process. This collaboration addressed challenges related to cash handling, reduced risks for collection teams, and improved reconciliation processes through API integration. As a wholly-owned subsidiary of Centrum Capital Limited, it was part of a broader financial services group with diverse business lines. In a significant corporate restructuring, all assets and liabilities of Centrum Microcredit Limited were transferred to the newly incorporated Unity Small Finance Bank (Unity SFB) as of November 1, 2021, following the consortium of Centrum Group and BharatPe receiving a Small Finance Bank license from the Reserve Bank of India.

Keywords: microfinance, financial inclusion, women entrepreneurs, joint liability group, NBFC-MFI, rural finance, urban poor, small business loans, financial services, micro-loans, Centrum Capital, Unity Small Finance Bank, FirstRand Bank acquisition, Altura Financial Services, PayNearby partnership, Ranjan Ghosh, Praveen Saha, Indian microfinance, income generation loans, financial literacy