Collections up as cash crunch pain reducing: Muthoot Fin

Gold Finance companies have been the worst hit by demonetisation. However, George Alexander Muthoot, MD of Muthoot Finance feels the pain is reducing. Speaking to CNBC-TV18, he said 65 percent of pre-demonetisation disbursals were done now. The repayment rate has improved to 65-70 percent and interest collection is about 80 percent. "Company has grown by 12 percent and there will be no de-growth in this quarter," said Muthoot.He feels the company should be reaching 18-20 percent growth as things get better. Government has been encouraging people to transact online and Muthoot says online transaction after November 8 were around 20 percent but now it is 50 percent. Below is the verbatim transcript of George Alexander Muthoot's interview to Latha Venkatesh, Sonia Shenoy and Anuj Singhal on CNBC-TV18.Anuj: You have data for one month now, tell us what has been the impact?A: When it started, it had a big impact. Now the impact is waning rather we are getting traction on more and more of these things which we are able to do now.Anuj: Can you give us some numbers, some qualitative analysis?A: In the last few days, we have been able to about 65 percent of our disbursals, premonetisation disbursals we are able to do now and about 65-70 percent of our repayments are also happening now.These things, a good percentage is happening through online and rest through the cash, which is starting to trickle down to the people. So overall 65-70 percent of our disbursals and repayments are happening and as far as interest collection is concerned, it is much better, interest collection about 80 percent plus is happening.Latha: Can you give us a little more colour on repayments, what were they in the early part of the month or rather mid-November and how are repayments now both interest and principle?A: It has hiked up from 30-40, now it is 65-70 what we are seeing. Initially it was very poor because people did not know what to do etc. Now we have been sensitizing our customers and also our staff to ask customers to take money through NEFT, through RPGS etc. As I have always been saying, I am sure 30 percent of our business even in the good times, maybe after all this is settled down also, will be through cash because the average ticket size is only Rs 40,000. Certainly cash is required and I am sure in the next two-three months when cash is more available with customers, those customers should also start coming back.For full discussion, watch accompanying video...