In the year 2021-2022, with the anticipated obstacles presented, we were able to make significant leaps. We have taken key strategic decisions that will enable us to enhance our presence as well as stature over the longer term. These decisions will provide us the competitive advantage that would help us solidify our foothold in the space we are passionate about, protect our relationships with our clients, in which we continue to enjoy a high level of recognition and trust, and provide us with the momentum to grow as a business.
As a result, we are more determined than ever to enable financial inclusion across the county. As we collectively focus on recovery from the impact of the pandemic, it is now time to reach out for more. At SCNL, we are constantly inspired by our employees’ and clients’ courage and dedication.
The first quarter of the fiscal year witnessed chaos, uncertainty and a dip in economic activity due to the toll pandemic took on the population and the rising inflation across the country. However, the second and third quarter witnessed a gradual growth in economic activity, driven by sales related to the festive season. Also being seen was the positive impact of the supportive measures extended by the Government to businesses, particularly the MSMEs in addition to the fiscal stimulus package.
The microfinance industry has been through the toughest time yet since the Covid-19 pandemic began. After the second wave, the overall collection efficiency around June 2021 went down and NPAs were expected to rise as defaults were growing. However, the fiscal year also observed the industry witnessing a turn around. One of the key reasons for this was that microcredit customers are also among the most resilient. The rural economy continues to grow on the back of healthy agricultural yields and government support for job creation and digitization.
Our cumulative collection efficiency bounced back to almost pre-COVID levels. Our Consolidated AUM touched INR 7,617 Crores, growing at 6% (quarter-on-quarter basis) indicating that we are back in the growth phase. Our disbursements have grown back at levels seen pre-COVID-19.
We successfully delivered INR 225 Crores fundraise through the preferential allotment via the issue of equity shares and fully convertible warrants. This followed the fully paid-up INR 120 Crores Rights Issue closed in August 2020. Our fundraise over the past two years leaves us well capitalized to target greater ambitions from within, and cater to greater expectations from our customers across the country. We commit to pursuing our mission more aggressively, backed by the trust of our investors.
At SCNL, we believe in doing the right things, the right way. We have seen a string of challenges over the past decade, which we have withstood, and embraced to its learnings. These learnings have primed us to strategically target bigger goals. We have also continued to build our capabilities as a result.
Our sustainability business strategy integration of Environment, Social and Governance (ESG) reporting practices are across people, planet, and processes. Our social initiatives aim at empowering women through skill development, education, and health awareness. We also try mitigating environmental impact by financing clean energy loans, thus reducing our carbon footprint. We also lend to enable our clients to secure better water and sanitation infrastructure through Water, Sanitation and Hygiene (WASH) loans.
For us at SCNL, our people and their well-being as well as their professional growth are our top priority. They are the ones who enable us to create long-term stakeholder value. On behalf of SCNL, I would like to express my gratitude to members of our team for putting in their best in these troublesome times.
In terms of accolades, we were conferred as part of ‘Great Place to Work’ for the third time in a row, and amongst the Top 30 BFSI, second time in a row. SCNL has been ranked 38th among the ‘Top 100 India’s Best Companies to Work for 2022’ across all industries and has also been recognized as ‘Best in Microfinance Industry’ by Great Place to Work® Institute (India) in the month of June 2022.
In our quest to grow and do more, we are going to be decisive and continue to focus on what differentiates us. It is our specific expertise in the field of microfinance, the agility and dedication of our teams, our advanced technology, and our prudent approach overall.
I thank all our people for believing in us. I am grateful to all our investors for backing us. I am inspired by all our clients for showing unflinching commitment and resilience.
Thanking You.
With warm regards,
HP Singh