Q: How would you describe Abans Finance’s journey so far?
A: Abans Finance – a member of the Abans Group – was incorporated in 2005 and listed on the Colombo Stock Exchange (CSE) in 2011. The company presently operates with nine branches and nine customer centres in addition to its head office while reaching customers through the group’s islandwide network.
Moreover, its operations encompass around 2,000 active deposit clients, which showcases their continuous trust in the brand.
Abans Finance’s loan facilities are focussed on uplifting SMEs, and middle and low-income earners, while ensuring the quality of its lending portfolio in accordance with the regulations set by the Central Bank of Sri Lanka.
Q: What differentiates the company from its competition?
A: One of Abans Finance’s main differentiators is its retention of customer trust and satisfaction, which are key indicators of how likely they are to obtain more services in the future. We make use of balanced scorecards in line with this to ensure that these measures are monitored.
Our deposit products include fixed deposits and savings, which provide numerous benefits to customers. The investment returns to depositors have been guaranteed by our prudent approaches and regulatory compliance, and they are adjusted for risk. Customers’ deposits are handled with care and managed by a framework of ethical fund management.
All funds received are reinvested in the company’s various diversified lending products, thereby adding value to all stakeholders. Fixed deposits are accepted for tenures ranging from a month to five years where interest is paid either periodically or at maturity while savings accounts are open for longer periods.
In addition to this, Fitch Ratings cited the outlook for Abans Finance’s national long-term rating as ‘Outlook Evolving’ and affirmed its rating of ‘A(lka),’ indicating stability primarily for fixed deposit clients.
Q: In your assessment, how have Abans Finance’s offering and operations contributed to the financial services industry?
A: Over the years, Abans Finance has been able to provide access to an adequate range of safe, convenient and affordable financial services primarily to the SME sector, which is often not catered to by banks – and as such, are excluded from the formal financial services segment.
From a lending point of view, this has been largely achieved by offering leasing facilities for both unregistered and registered motorcycles, and three wheelers. As for fixed deposits, we have done so by establishing trust over the years.
Q: Has Sri Lanka achieved progress in terms of financial inclusion or literacy?
A: The benchmark for achieving financial inclusion or literacy is set by developed economies; there is no end to this process.
As the country progresses economically, and with the sophistication of the Sri Lankan lifestyle resulting from financial inclusion and literacy, our economy will advance.
The recent trend of government and statutory authorities facilitating online payments – such as those for utilities, licence fees and internet banking – will continue to expand with the introduction of mobile and smartphone technology, and availability of internet facilities.
Q: How does the organisation ensure accountability where sustainability is concerned?
A: The board and management firmly believe that a sound governance framework is vital to achieving sustainable growth in this industry, to maintain the trust and confidence investors and customers place in us.
Abans Finance focusses on the triple bottom line concept and is committed to achieving sustainable growth by providing inclusive financial solutions through the branch network, service centres and digital channels.
To manage the company in a financially sustainable manner, we have taken important steps to minimise the concentration risk of deposits by setting up key performance indicators (KPIs) for staff in the balanced scorecard framework.
And the positioning map of each risk component is placed in a risk grid where tolerance levels are set by using sustainable measurements that are discussed at risk management meetings.
By following a strong corporate governance code, the company is focussed on directors, directors’ remuneration, relations with shareholders, accountability and audits, institutional and other investors, and sustainability reporting.
Management committees such as the asset and liability, credit and IT steering committees also play major roles in decisions related to long-term sustainability.
The trust created among fixed deposit clients has led to around 76 percent of the company’s funding mix originating from deposits, which reflects the perception of Abans Finance’s stability among customers.
Q: And what are Abans Finance’s future plans?
A: Abans Finance is committed to enhancing business activities through futuristic products that suit clients’ requirements and improving its digital presence while pursuing continuous advancements in sustainability.