Future Group company sets target of 100 stores in 12 months; aims to leverage its wide customer base countrywide through financial outlets that will be integrated with its large format stores

Future Capital Holdings, part of Future Group, today announced plans to launch 100 financial superstores in 12 months that will help grow its financial services business faster, by reaching more customers.

The company, which specialises in loans for homes, consumer durables, as well as loans for small and medium enterprises, has set a target to disburse Rs1,000 crore of secured loans for 2011-12 and have 100,000 customers through the stores, building a very strong fee income business through wealth management, broking and insurance businesses.

"We are planning to launch 100 such financial branches by 2012 that will meet all four basic financial needs of the customer-borrowing, investment, protection and financial planning," said V Vaidyanathan, vice-chairman and managing director, Future Group. "We will offer loans for homes, properties, gold loans. Protection for these loans will also be offered through our insurance products. To provide alternate investments to our customers we have tied up with mutual funds. And lastly, financial planning will be delivered through broking and wealth management."

The stores will be integrated with the group's retail outlets like Big Bazaar, E-zone and Hometown. The company has 200 large stores across these formats. In the first phase, it will open 100 financial superstores at these establishments, on the basis of customer footfalls, customer intersection and expectations.

The concept of retail financial stores is new in India, but it has been a highly successful model abroad, in countries like the US, Europe, Brazil and Mexico. An example is Wal-Mart, which has over 1,000 Wal-Mart money centres across its network of retail stores, providing money orders, transfers, etc.

"We are in the process of tying up with banks and our role would be as a distributor. We are mainly looking at public sector banks," Mr Vaidyanathan said. He said that the loan business was doing well. "In fact, our loan book has increased by about 100% this year, from Rs1,500 crore last year to Rs3,000 crore this year. Next year we target Rs5,000 crore. Our loan business is on the right track and of course it is funded by loans from the banking system," Mr Vaidyanathan said.

When asked about over-the-counter loan disbursals, Mr Vaidyanathan said, "For businesses like property loans it cannot be done over the counter, since verification is required and this can take 4-5 days. It may also take a little longer. Though the principal amount can be sanctioned, the loan cannot be disbursed. But for consumer durables loans we have tied up with credit bureaus and credit scoring companies, so these activities can be done over the counter."

The company's wealth management and broking service will be looked after by the company's wholly-owned subsidiary FCH Centrum Wealth Managers.

The company also said that about 300 people will be recruited for the financial retail stores.