GE Money, part of world’s largest conglomerate, GE plans big in the Indian financial market. It is aiming to expand its consumer finance business by increasing asset size to $8 billion by 2010 from current $2 billion.
GE has a well-known strategy of being either number one or two in every business it operates in, otherwise it exits that business. GE perceive Indian market having high growth potential having a booming retail and mortgage market.
But to become the largest NBFC, GE Money India needs to expand its branch network from current 160 to 600. It is even reported that it could receive fund infusion of $1 billion from its parent, which is one-ninth of its asset value.
GE Money is even contemplating exiting its key business of consumer durables finance which has become unviable due to low margins and high defaults. It would instead focus on high growth and profitable business of personal loans, cars, mortgages and private label credit cards.
GE Money also runs successful JV with Maruti and SBI for auto finance and credit cards respectively. To expand its growth, it is in talks with big retailers to offer credit programmes such as a private label credit card, which it currently offers to customers of Tata owned companies like Taj Hotels, Tata Motors, Westside and Tanishq.
GE Money is in talks for tieup with Bharti-Wal-Mart, Reliance Retail, Aditya Birla Retail, Subhiksha, Spencer’s and the Future Group. It could even sell personal loans through these big retail chains besides it own branches.
But given the scenario that most of the retailers have their own financial services businesses, it will not be easy to strike a deal. Though a deal with Bharti-Wal-Mart is most likely as GE Money has a global relationship with Walmart.
Find this article at: http://www.labnol.org/india/corporate/ge-money-aims-to-become-largest-nbfc-eyes-tieup-with-retailers/947/
Tags: aditya birla, bharti, pantaloon, reliance retail, subhiksha, walmart, Corporate, India
