Bandhan Financial Services

Written By ADITYA

Bandhan was set up by Mr. Chandra Shekhar Ghosh in 2001 as a non-governmental organization (NGO), Bandhan-Konnagar, under the West Bengal Societies Registration Act, 1961. In 2006, the NGO acquired NBFC, Ganga Niryat Pvt Ltd, and renamed it as Bandhan Financial Services Pvt Ltd (Bandhan) and transferred the NGO’s microfinance activities to the company. Bandhan was reconstituted as an NBFC-MFI in 2013.



Currently, Bandhan undertakes microfinance activities and Bandhan-Konnagar implements developmental programs. Bandhan is the largest MFI in India with a market share of over 20 percent, loan portfolio of Rs.4,457 crore, and borrower base of nearly 50 lakh as of September 30, 2013.

The company has a strong presence in West Bengal and other eastern and north-eastern states. Bandhan has
received “in-principle” approval from RBI for the commencement of the banking business.

Performance on key parameters

  • The portfolio outstanding and borrower base have grown at a CAGR of 44 and 24 percent respectively during the 3 years ended March 31, 2013. The geographic diversity is set to improve through expansion in operations to other states
  • Asset quality is healthy, supported by adequate operational practices and multiple levels of tracking and monitoring
  • Has relationships with nearly 30 banks and financial institutions. Focused on improving diversity in resource profile by raising subordinate debt, and issuing non-convertible debentures. Needs to diversify resource profile substantially and reduce dependence on wholesale funding as operations are scaled up
  • Capitalization adequate for the current scale of operations, as reflected in the large net worth of Rs.1,020 crore and low gearing of 4.2 times as on September 30, 2013.
  • Earnings profile is above average, with a high return on managed assets. Profitability is supported by low operating expense


Portfolio size and growth, client outreach, and profitability over the last three years at Bandhan Financial Services.


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