KOCHI: Federal Bank, the Aluva-headquartered leading private bank, has attracted 21% of remittances that have come to India in the last financial year, but it is seeing a "fair amount" of the NRI deposits going out for the construction of homes or setting up small businesses.
Addressing the Ernakulam Press Club's 'Take Off Kerala' meet the press programme, Shyam Srinivasan, CEO of Federal Bank, said the bank is re-launching 'Launch Pad', a platform akin to an incubation facility that would provide a common platform for startups to come and operate.
On NRI remittances, Srinivasan said Federal Bank attracted Rs 1,40,000 crore as remittances in the 2021-22 financial year, which constituted 21% of India's remittances.
"It's continuing to grow strong," he said. Stating that there is a change in the utilisation of the remittances, Srinivasan said that earlier, a large part of the money remained in the bank as savings.
"Now, a fair amount of remittances are going for construction and/or setting up small businesses. There is a difference in the use of money and there's a lesson in it. I think people who have relocated from outside are setting up small businesses or are re-establishing themselves in the state by buying homes or are investing in properties," he said.
STARTUP 'LAUNCH PAD'
The Federal Bank CEO said the bank was relaunching its facility for startups, which was first launched some eight years back.
"This was an idea ahead of its time. When we started this 'Launch Pad' some eight years back, the number of people who came did not measure up. Only one good case was there," Srinivasan said.
He said the bank has a 'Launch Pad' facility in Maradu, Kochi, and one in Bengaluru.
"It's a platform for young entrepreneurs to come, experiment, and try to use the common facility for developmental activity. Anybody can come and use our facility as a developmental centre. If there's a good case, lending will also be done," he said, adding that the bank has recently lent Rs 1 crore for a Kochi-based robotics startup 'Asimov Robotics'.
"We will be having it in a few more cities," he said.
Asked about more lending to startups, Srinivasan said the bank can't behave like private equity or a venture fund.
"We have to lend against business models that are possible to value. And we should see cash flows. Banks are using public money to lend, so our responsibilities are different from private equity and venture fund," he said.
FEDERAL BANK ONLY INDIAN BANK IN ASIA'S BEST PLACE TO WORK
Srinivasan said Federal Bank was recognised among India's best companies to work for in 2022 for the second year in a row. The selection was done by 'Great Place to Work Institute, a global organisation.
"We are proud because Federal Bank is the only bank in India which is on Asia's best place to work list," he said.