Bajaj Finance Explained

Bajaj Finance Limited
Former Name:Bajaj Auto Finance Limited (1987–2010)
Type:Public
Traded As:

BSE SENSEX constituent
NSE NIFTY 50 constituent
Industry:Financial services
Founder:Rahul Bajaj
Location City:Pune
Location Country:India
Products:Lending, fixed deposits, mutual funds
Revenue: (2024)
Operating Income: (2024)
Net Income: (2024)
Assets: (2024)
Aum: (2024)
Equity: (2024)
Parent:Bajaj Finserv (52.49%)
Subsid:Bajaj Financial Services
Bajaj Housing Finance
Bajaj Financial Securities
Rating:
  • CRISIL AAA+/Stable Long-term debt[1]
  • ICRA AAA+/Stable Non-convertible debenture[2]
  • CARE AAA+/Stable Non-convertible debenture[3]
Footnotes:Financials .[4]

Bajaj Finance Limited (BFL) is a deposit-taking Indian non-banking financial company headquartered in Pune.[5] [6] It has a customer base of 88.11 million[7] and holds assets under management worth, as of June 2024.[8]

As per the 2023 list of NBFCs issued by the Reserve Bank of India, Bajaj Finance Limited holds the second position in the upper layer based on scale-based regulation guidelines.[9] [10]

History

Originally incorporated as Bajaj Auto Finance Limited on March 25, 1987, as a non-banking financial company, primarily focused on providing two and three-wheeler finance.[11] After 11 years in the auto finance market, Bajaj Auto Finance Ltd launched its initial public issue of equity share and was listed on the Bombay Stock Exchange and National Stock Exchange of India.[12] At the turn of the 20th century, the company ventured into the consumer durables finance sector and started offering small-size loans.[13] [14] In the subsequent years, Bajaj Auto Finance diversified into business and property loans as well.[15] [16]

In 2006, the company's assets under management hit the . In 2010, the company's registered name changed from Bajaj Auto Finance Limited to Bajaj Finance Limited.[17]

By 2015, BFL had set up a series of Disaster Recovery (DR) data centers for business continuity.[18] Additionally, by 2020, it had started using data analytics and big data tools.[19]

In January 2023, Bajaj Finance launched its loan against property (LAP) business for micro, small, and medium-sized enterprise (MSME) customers.[20] [21] By 2020, 60% of Bajaj Finance's workload was on cloud and originally, they aimed to create a super-app for existing customers, but due to COVID-19 pandemic in India, they expanded the plan to encompass various services by integrating five proprietary marketplaces within their ecosystem—EMI store, insurance, mutual funds, broking, and health.[22]

Operations

As of March 2023, the company deals in consumer lending, SME (small and medium-sized enterprises) lending, commercial lending, rural lending, deposits, and wealth management.[23] And, across 3800 towns,[24] it has 294 consumer branches and 497 rural locations with over 33,000+ distribution points and 1,50,000+ stores.[25]

As of June 2022, Bajaj Finance has been working with RBL Bank and DBS Bank to issue co-branded credit cards.[26]

Most of Bajaj Finance's revenue is generated from suppliers who pay for access to their larger customer base.[27]

Subsidiaries

Financials

In the year 2021, an analysis using Spearman's rank correlation coefficient was conducted to examine the relationship between revenue factors and non-performing assets (NPA) parameters in Indian non-banking financial companies. Specifically, when studying Bajaj Finance, it was observed that there existed a statistically significant positive correlation between revenue and gross NPA (P<0.04), profit after tax (PAT) and gross NPA (P<0.04), as well as return on assets (ROA) and gross NPA (P<0.005), with a negative correlation found in the latter case.[33] [34]

In a study conducted in 2023, examining 30 companies listed on the Bombay Stock Exchange, which was subsequently published in the European Economic Letters journal, it was found that Bajaj Finance stock reached a maximum average return of 58.58%.[35]

Funding and investments

The parent company, Bajaj Finserv Limited, holds 52.49% of the total shares and has a controlling stake in the subsidiary. Other major investors include Maharashtra Scooters Limited, the Monetary Authority of Singapore-Government of Singapore, Nomura Securities, BNP Paribas, Smallcap World Fund INC, and AXIS Long Term Equity Fund.[36] [37]

Investments

In 2017-18, Bajaj Finance acquired a 12.6 percent interest in the mobile wallet company MobiKwik.[38] [39] [40] [41]

In November 2022, Bajaj Finance announced its intention to acquire Mumbai-based SnapWork Technologies for through a combination of primary and secondary transactions. The acquisition was anticipated to be completed before 31 December 2022.[42]

Climate finance

In November 2024, the company partnered with the International Finance Corporation, has secured $400 million as part of a $1 billion fundraising initiative to expand access to climate finance in India. This funding is aimed at promoting the adoption of electric vehicles (EVs) across two-, three-, and four-wheelers, supporting energy-efficient consumer goods (EECG), and increasing financial inclusion for women-owned microenterprises and women micro-borrowers.[43] [44]

Regulatory

In September 2022, the Reserve Bank of India (RBI) included Bajaj Finance as one of the 16 NBFCs that are part of the NBFC-Upper Layer list. This means that the RBI has requested that the company must develop and implement a board-approved policy for the adoption of the more stringent regulatory framework that is applicable to it.[45] [46]

Compliance issues

In November 2023, RBI banned the company from approving or distributing loans through two of its lending services, namely 'eCOM' and 'Insta EMI Card'.[47] [48] [49] [50] In an exchange filing in May 2024, the company announced that the RBI had lifted the said restrictions following remedial actions taken by the company.[51] [52]

Philanthropy

Bajaj Finance is involved in "Bajaj Beyond," a collaborative CSR initiative with Bajaj Auto and Bajaj Electricals, committing crore to multiple social impact projects.[53] The company collaborates with various institutions including the Jamnalal Bajaj Foundation, Jankidevi Bajaj Gram Vikas Sanstha, and the Kamalnayan Bajaj Hospital.[54] Also, it is involved in various areas such as education, empowering women, providing skill-building training, healthcare, and other projects focused on socio-economic development.[55]

Further reading

Notes and References

  1. Web site: 2023-08-01 . Bajaj Finance deposits cross Rs 50,000 crore . 2023-06-30 . . en.
  2. Web site: 2023-06-06 . Bajaj Finance Ltd.: Ratings reaffirmed . 2023-06-30 . . en . 30 August 2023 . https://web.archive.org/web/20230830150501/https://www.icra.in/Rationale/ShowRationaleReport/?Id=120310 . live .
  3. Web site: 2023-01-05 . Bajaj Finance Ltd Revised . 2023-06-30 . CAREEdge . en.
  4. Web site: Bajaj Finance FY24 Q4 Results.
  5. Web site: 2021-04-21 . World Bank's IFC to make debt investment of $150 mn in Bajaj Finance . 2022-03-17 . VCCircle . en-US . 26 October 2021 . https://web.archive.org/web/20211026190549/https://www.vccircle.com/world-bank-s-ifc-to-make-debt-investment-of-150-mn-in-bajaj-finance/ . live .
  6. Mahali . Monica . Bandopadhyay . Kalpataru . 2022-03-10 . Evidence-Based Management: Case of Bajaj Finance Limited . The Management Accountant . en . Rochester, NY . 57 . 4 . 47–51 . 10.33516/maj.v57i4.47-51p . 4083601. 251269765 . subscription .
  7. Web site: www.ETBFSI.com . Bajaj Finance AUM jumps 31% as aggressive customer acquisition pays - ET BFSI . 2024-09-26 . ETBFSI.com . en.
  8. News: Varier . Aarthira . 3 June 2024 . Bajaj Finance's AUM rises 31% in Q1FY25, new loans booking improves by 10% . 26 September 2024 . Business Standard.
  9. Web site: 2023-09-14 . RBI places 15 NBFCs in the upper layer under scale-based regulations . live . https://web.archive.org/web/20231002220509/https://www.thehindubusinessline.com/money-and-banking/rbi-places-15-nbfcs-in-the-upper-layer-under-scale-based-regulations/article67307474.ece . 2 October 2023 . 2023-10-01 . BusinessLine . en.
  10. Web site: Dayal . Yogesh . 14 September 2023 . RBI releases list of NBFCs in the Upper Layer (NBFC-UL) under Scale Based Regulation for NBFCs . 2023-10-01 . . 1 October 2023 . https://web.archive.org/web/20231001194928/https://www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=56373 . live .
  11. Web site: Sitaraman . Krishnan . Velonie . Ajit . Bhargav . Krishna . 13 July 2021 . CRISIL - Rating Rationale, Bajaj Finance Limited . 17 March 2022 . . 18 June 2022 . https://web.archive.org/web/20220618133304/https://www.thefixedincome.com/uploads/products/ratingfile/1633077138crisil%20bajaj.pdf . live .
  12. Web site: Bajaj Finance Ltd (Bajfinance) - Strategy, SWOT and Corporate Finance Report . 2022-03-17 . Marketline . en-US .
  13. Book: Meenakshi, Arun Kumar & N. . Marketing Management, 2nd Edition . 2011 . Vikas Publishing House . 978-81-259-4259-7 . en.
  14. Book: Mishkin . https://books.google.com/books?id=2PK0DwAAQBAJ&dq=bajaj+finance&pg=PA31 . Financial Markets and Institutions . S . Frederic . Eakins . Stanley . 2000 . . 978-93-89588-61-3 . . 31 . en . Chapter 2: Overview of the Financial System . 1 October 2023 . 2 October 2023 . https://web.archive.org/web/20231002220508/https://books.google.com/books?id=2PK0DwAAQBAJ&dq=bajaj+finance&pg=PA31 . live .
  15. R . Sathishkumar . G . Balamurugan . 30 November 2019 . Profitability Analysis of Lease Financing Company (A Study with Reference to Bajaj Finance Limited) . JAC: A Journal of Composition Theory . en . 12 . 11 . 917–924 . 0731-6755 . 3572491.
  16. Book: Piramal, Gita . Rahul Bajaj: An Extraordinary Life . 2022-03-21 . Penguin Random House India Private Limited . 978-93-5492-493-4 . en . 4 August 2022 . 14 July 2023 . https://web.archive.org/web/20230714172336/https://books.google.com/books?id=fUhkEAAAQBAJ&dq=%22Bajaj+Finance%22&pg=PT401 . live .
  17. Web site: BAJFINANCE Summary: Latest Updates and Details India Infoline . live . https://web.archive.org/web/20170419002602/http://www.indiainfoline.com/company/bajaj-finance-ltd/summary/3722 . 2017-04-19 . 2024-06-27 . indiainfoline.com . en.
  18. Web site: Vasudevan . Smita . 2015-08-04 . How Bajaj Finance is drawing big returns from its well-placed technology bets . 2023-07-29 . DATAQUEST . en-US . 29 July 2023 . https://web.archive.org/web/20230729123156/https://www.dqindia.com/how-bajaj-finance-is-drawing-big-returns-from-its-well-placed-technology-bets/ . live .
  19. Book: Phadke, Sanjay . FinTech Future: The Digital DNA of Finance . 2020-03-31 . SAGE Publishing India . 978-93-5388-249-5 . en . 27 September 2023 . 2 October 2023 . https://web.archive.org/web/20231002220510/https://books.google.com/books?id=jx7TDwAAQBAJ&dq=Bajaj+Finance&pg=PT65 . live .
  20. Web site: Vashisht . Deepak Korgoankar & Nikita . 2023-01-30 . Bajaj Finance's long range strategy lifts stock 5% higher . 2023-01-31 . www.business-standard.com . en . 31 January 2023 . https://web.archive.org/web/20230131165246/https://www.business-standard.com/article/markets/bajaj-finance-surges-5-on-record-quarterly-profit-123013000276_1.html . live .
  21. Web site: Srivats . K. R. . 2023-04-12 . Bajaj Finance plans entry into microfinance segment by 2025, says Sanjiv Bajaj . 2023-05-01 . www.thehindubusinessline.com . en . 1 May 2023 . https://web.archive.org/web/20230501091548/https://www.thehindubusinessline.com/money-and-banking/bajaj-finance-plans-entry-into-microfinance-segment-by-2025-says-sanjiv-bajaj/article66729525.ece . live .
  22. Web site: Adhikari . Anand . 2022-03-04 . How Rajeev Jain is Transforming Bajaj Finance . 2024-03-08 . Business Today . en . 12 April 2022 . https://web.archive.org/web/20220412104334/https://www.businesstoday.in/magazine/corporate/story/how-rajeev-jain-is-transforming-bajaj-finance-324764-2022-03-04 . live .
  23. Web site: Exploring the Next Generation Employee Experience: Case Study of Bajaj Finance Limited . 2022-03-17 . The Case Centre . en . 17 April 2022 . https://web.archive.org/web/20220417134912/https://www.thecasecentre.org/products/view?id=169800 . live .
  24. Web site: John . Nevin . 2023-10-10 . Bajaj Finance's Fire Fighter . 2024-03-08 . . en.
  25. Web site: July 7, 2022 . Mayur . Shetty . Bajaj Fin's assets grow 31% to cross Rs 2L crore. 2022-08-01 . The Times of India . en.
  26. Web site: Karthik . Hamsini . 2022-08-18 . Bajaj Finance readies for entry into credit cards business . 2022-08-31 . www.thehindubusinessline.com . en . 31 August 2022 . https://web.archive.org/web/20220831163614/https://www.thehindubusinessline.com/money-and-banking/bajaj-finance-readies-for-entry-into-credit-cards-business/article65782839.ece . live .
  27. Book: Bijapurkar, Rama . Lilliput Land: How Small is Driving India's Mega Consumption Story . 2024-02-29 . Penguin Random House India Private Limited . 978-93-5708-379-9 . en.
  28. Book: Babel, Rajeev . Handbook of Non-Banking Financial Companies . 2021-03-15 . Bloomsbury Publishing . 978-93-90176-20-5 . en . 17 June 2024 . 12 May 2024 . https://web.archive.org/web/20240512060131/https://books.google.com/books?id=nIckEAAAQBAJ&dq=Bajaj%20Housing%20Finance&pg=SA8-PA22 . live .
  29. Web site: 2024-06-06 . Bajaj Housing Finance: Board approves IPO . live . https://web.archive.org/web/20240617080129/https://www.thehindubusinessline.com/markets/bajaj-housing-finance-board-approves-ipo/article68259809.ece . 17 June 2024 . 2024-06-17 . BusinessLine . en.
  30. News: 2024-06-06 . Bajaj Housing Finance board approves over ₹4,000-crore IPO . live . https://web.archive.org/web/20240617080129/https://www.thehindu.com/business/bajaj-housing-finance-board-approves-over-4000-crore-ipo/article68259504.ece . 17 June 2024 . 2024-06-17 . The Hindu . en-IN . 0971-751X.
  31. Web site: PTI . 2024-06-08 . Bajaj Housing Finance IPO: NBFC files papers for ₹7,000-cr public issue . 2024-06-17 . BusinessLine . en . 17 June 2024 . https://web.archive.org/web/20240617080130/https://www.thehindubusinessline.com/markets/bajaj-housing-finance-ipo-nbfc-files-papers-for-7000-cr-public-issue/article68266119.ece . live .
  32. Web site: Velonie . Ajit . Bhotika . Malvika . Sarvaiya . Foram . 18 October 2023 . Rating Rationale: Bajaj Financial Securities Limited . 17 June 2024 . CRISIL.
  33. P . Joseph Antony . Al . Et . 2021-06-04 . Study of Comparative Performance of Non-Performing Assets among Selected Leading Non-Banking Financial Companies of India . Turkish Journal of Computer and Mathematics Education (TURCOMAT) . en . 12 . 13 . 1077–1085 . 1309-4653 . . 27 May 2023 . 27 May 2023 . https://web.archive.org/web/20230527072557/https://turcomat.org/index.php/turkbilmat/article/view/8616 . live .
  34. Sonkar . Shubham . Paliwal . Nilesh . 2020 . Analysis of the difference in performance among various NBFCs in recent times . Digital Institutional Repository of IIM Bangalore . . 27 May 2023 . 27 May 2023 . https://web.archive.org/web/20230527073609/https://repository.iimb.ac.in/handle/2074/19637 . live .
  35. Ali . Shahnawaz . 2023-07-21 . Impact of Firm Performance on Stock Returns: A Study of 30 Listed Firms in Bombay Stock Exchange . European Economic Letters . en . 13 . 3 . 1253 . 10.52783/eel.v13i3.422 . 2323-5233 . free . 1 October 2023 . 2 October 2023 . https://web.archive.org/web/20231002220510/https://eelet.org.uk/index.php/journal/article/view/422 . live .
  36. Web site: Adhikari . Anand . 2019-11-14 . An unusual investor is most bullish on Bajaj Finance stock . 2023-10-01 . Business Today . en . 2 October 2023 . https://web.archive.org/web/20231002222011/https://www.businesstoday.in/markets/company-stock/story/an-unusual-investor-is-most-bullish-on-bajaj-finance-stock-238902-2019-11-14 . live .
  37. Web site: Bajaj Finance Ltd Share Price Today Live NSE/BSE ICICI Direct . 2023-10-01 . ICICIdirect . 2 October 2023 . https://web.archive.org/web/20231002222016/https://www.icicidirect.com/stocks/bajaj-finance-ltd-share-price . live .
  38. Web site: 2017-08-03 . MobiKwik partners Bajaj Finance for larger financial services pie . 2022-08-01 . www.thehindubusinessline.com . en . 1 August 2022 . https://web.archive.org/web/20220801141553/https://www.thehindubusinessline.com/money-and-banking/mobikwik-partners-bajaj-finance-for-larger-financial-services-pie/article9800989.ece . live .
  39. News: Bajaj Finance to acquire 12.6% in Mobikwik . The Economic Times . 2022-08-01 . 1 August 2022 . https://web.archive.org/web/20220801141553/https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/bajaj-finance-to-acquire-12-6-in-mobikwik/articleshow/62519417.cms . live .
  40. Web site: Bose . Indranil . Kashyap . Nishant . 2019 . Mobikwik's Full Service FinTech Platform Bet: Will it be a Winner? . 27 May 2023 . . 27 May 2023 . https://web.archive.org/web/20230527072558/https://ir.iimcal.ac.in:8443/jspui/handle/123456789/3802 . live .
  41. Web site: Mobikwik looks to raise $100 million as it delays IPO plans, founder says the 'markets are not ready' . 2022-08-01 . Business Insider . 1 August 2022 . https://web.archive.org/web/20220801141554/https://www.businessinsider.in/business/news/mobikwik-plans-to-raise-100-million-as-ipo-delayed/articleshow/92099731.cms . live .
  42. Web site: 2022-11-26 . Bajaj Finance to acquire up to 40% stake in Snapwork Technologies for up to ₹93 crore . 2022-12-31 . www.thehindubusinessline.com . en . 31 December 2022 . https://web.archive.org/web/20221231165432/https://www.thehindubusinessline.com/companies/bajaj-finance-to-acquire-up-to-40-stake-in-snapwork-technologies-for-up-to-93-crore/article66185099.ece . live .
  43. Web site: Srivats . K. R. . 2024-11-06 . IFC invests $400 million in Bajaj Finance, aiming to quadruple climate loans by 2027 . 2024-11-29 . BusinessLine . en.
  44. News: Varier . Aathira . 6 November 2024 . IFC to partner with Bajaj Finance to pump in $400 mn for climate finance . 29 November 2024 . Business Standard.
  45. Web site: Dayal . Yogesh . September 30, 2022 . RBI releases list of NBFCs in the Upper Layer under Scale Based Regulation for NBFCs . October 9, 2022 . . 9 October 2022 . https://web.archive.org/web/20221009145405/https://rbidocs.rbi.org.in/rdocs/PressRelease/PDFs/PR9755816872919874356B69ED5CB3415DB20.PDF . live .
  46. Web site: RBI lists 16 NBFCs in upper layer, includes Tata Sons . 2022-10-09 . Financialexpress . October 2022 . en . 9 October 2022 . https://web.archive.org/web/20221009145359/https://www.financialexpress.com/economy/rbi-lists-16-nbfcs-in-upper-layer-includes-tata-sons/2697209/ . live .
  47. Web site: 2023-11-16 . RBI orders Bajaj Finance to stop eCOM, Insta EMI Card loans . 2023-11-19 . The Indian Express . en . 19 November 2023 . https://web.archive.org/web/20231119074151/https://indianexpress.com/article/business/banking-and-finance/rbi-orders-bajaj-finance-to-stop-ecom-insta-emi-card-loans-9028340/ . live .
  48. Web site: Kayastha . Anshika . 2023-11-15 . RBI orders Bajaj Finance to stop lending via eCOM, Insta EMI Card . 2023-11-19 . BusinessLine . en . 19 November 2023 . https://web.archive.org/web/20231119074150/https://www.thehindubusinessline.com/money-and-banking/rbi-orders-bajaj-finance-to-stop-lending-via-ecom-insta-emi-card/article67536488.ece . live .
  49. Web site: Sampath . Vineetha . 2024-01-04 . Bajaj Finance set for a sturdy quarter despite RBI directive . 2024-01-18 . mint . en . 18 January 2024 . https://web.archive.org/web/20240118182546/https://www.livemint.com/market/stock-market-news/bajaj-finance-set-for-a-sturdy-quarter-despite-rbi-directive-11704363981875.html . live .
  50. Web site: 2023-11-16 . Bajaj Finance stock recoups early losses post RBI ban; analysts see limited impact but eye quick resolution . 2024-01-18 . Moneycontrol . en . 18 January 2024 . https://web.archive.org/web/20240118182546/https://www.moneycontrol.com/news/business/stocks/bajaj-finance-may-fall-on-rbi-ban-analysts-see-limited-impact-but-eye-quick-resolution-11751321.html . live .
  51. News: Varier . Aathira . 2 May 2024 . RBI lifts curb on Bajaj Finance's lending products 'eCOM', 'Insta EMI Card' . live . 13 May 2024 . . 13 May 2024 . https://web.archive.org/web/20240513154928/https://www.business-standard.com/finance/news/rbi-lifts-curb-on-bajaj-finance-s-lending-products-ecom-insta-emi-card-124050201373_1.html .
  52. News: 2 May 2024 . India's Bajaj Finance says cenbank lifts ban on lending products . 13 May 2024 . Reuters.
  53. Web site: 2024-03-22 . Bajaj Group unveils 'Bajaj Beyond' initiative; commits ₹5,000 crore for social impact programmes . live . https://web.archive.org/web/20240513162510/https://www.thehindubusinessline.com/companies/bajaj-group-unveils-bajaj-beyond-initiative-commits-5000-crore-for-social-impact-programmes/article67979938.ece . 13 May 2024 . 2024-05-13 . BusinessLine . en.
  54. Web site: Matta . Anubhuti . Bajaj Group Unveils Bajaj Beyond, A CSR Initiative Committing Rs 5,000 Crore To Skilling India's Youth . 2024-05-13 . Forbes India . en.
  55. Book: Mansour . Nadia . Finance, Law, and the Crisis of COVID-19: An Interdisciplinary Perspective . Vadell . Lorenzo M. Bujosa . 2022-02-18 . . 2022 . 978-3-030-89416-0 . 27 . en.

This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Bajaj Finance".

Except where otherwise indicated, Everything.Explained.Today is © Copyright 2009-2025, A B Cryer, All Rights Reserved. Cookie policy.