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Sunday, October 20, 2013

DHFL’s education loan arm Avanse eyes Rs 100-crore turnover

Avanse, a recent entrant in education finance market, is eyeing Rs 100 crore turnover milestone this fiscal—the first full year of its operations.

This non-banking finance company, which is a DHFL Group company, has set for itself a business target of Rs 3,000 crore-Rs 4,000 crore in five years, it’s Chief Executive Officer Neeraj Saxena told BusinessLine here.

Avanse Financial Services, which will provide only higher education loans, has opened its first brick-and-mortar branch in Delhi to cater to the growing demand for such loans in the National Capital Region.

Besides Dewan Housing Finance Ltd (DHFL), Avanse Financial Services also has IFC, which is part of the World Bank group, as an equity investor.

Notable private sector players in the education loan market include Credilla Ltd, a HDFC Ltd venture.

Public sector banks too had delved deep into the education loan market, largely on the prodding of the Government.

The total education loan portfolio for the banking sector stood at about Rs 53,000 crore (for 25 lakh accounts) as at end March 2013.

Saxena said that Avanse already had a tie-up with DHFL whereby it could use the latter’s office space in various parts of the country to sell educational loans.

Besides a corporate office at Mumbai, Avanse has a branch each at Pune and Delhi and may open another branch at Bengaluru.

Education loans from Avanse come at interest rates of 12.25 percent-13.5 percent, Saxena said.

Avanse provide 100 percent education finance without any margin money and cover studies both within India and abroad, he said.

Source: thehindubusinessline


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