Bangalore: South Africa-based financial services group FirstRand Bank started the retail and commercial banking operations in India with the opening of a branch in the city.
"We are excited to start retail and commercial banking in India, which represents the first new market outside of Africa for these operations. We see India as an exciting business opportunity and this expansion is key to our long-term growth strategy," FirstRand Ltd Chief Executive Officer Sizwe Nxasana told reporters here.
He said the branch would help in facilitating greater economic, trade and investment flows between two countries.
At an event to mark the opening of FirstRand Bank's branch in Mumbai yesterday, Maharashtra Chief Minister Prithviraj Chavan had said, "Your decision to come to India is perhaps a little late, but I'm very happy that you chose Mumbai to start your operations, and rightly so because Mumbai is the financial capital of the country."
The function was also attended by South African Finance Minister Pravin Gordhan, among others.
India and South Africa have to play a greater role in stabilising the world economy, he said.
IBSA and BRICS are just manifestations that India and South Africa cannot be ignored, Chavan said.
While IBSE is a trilateral, developmental initiative between India, Brazil and South Africa to promote international cooperation among these countries, BRICS is a group of emerging world economies' Brazil, Russia, India, China and South Africa.
The Chief Minister also expressed the hope that FirstRand would also exploit the opportunities in other cities of India as well.
"I am sure that the Reserve Bank of India along with policy decisions being taken in the central government will provide huge opportunity for not only banking, but also for huge insurance portfolio and all other products that you are offering in Africa," he said.
The bank is also hopeful of introducing some of the technology based products in the country in the near future.
"We see much potential in India and think it is an excellent market to activate the technology we have in South Africa which can find applications in this market," the bank's Chief Executive Officer and India Country Head Mahendran Moodley said.
The bank will also tie up with various partners in the country to provide portfolio of products in the country.
"We will be using outside partners. If we don't have mortgage then we have someone else giving it. If I don't have vehicle finance, I will tie-up with someone else for that. There are certain products that we don't want to get into initially and we will use partners to collaborate," Chief Executive Officer (Commercial and Retail Banking) of FirstRand Bank, Bobby Madhav said.
He further said the bank plans to offer loan against gold after July.
As of now, the bank has tied up with Reliance Mutual fund for online sales along with Bajaj and Aditya Birla in the insurance segments.
Taking about increasing its footprint in other regions of the country, Madhav said the bank will initially concentrate in Maharashtra before entering into other markets.
"The goal is to get the business up and running in Maharashtra. Then we will look at another state with hub and spoke and smaller branches. We will take it to north and then come to the South later.
"Maharashtra itself is double the size of South Africa. If you can master this then it gives us a real good recipe for the rest of the country," he said adding that the bank is waiting for approval from the RBI to open five branches in the country.
The bank has $175 million assets in the country with 70 percent of it coming from corporate banking, which is already profitable.
Globally, it the second largest financial services group in South Africa with over $100 billion assets under management.
