Thank you, Mr. Ray, for connecting us to the world of investors. Good afternoon, everyone, and on behalf of our company, SBI Cards and Payment Services Limited, I extend a very warm welcome to you all, and thank you for joining us today for our investors' call after the company has been listed on March 16th. A very, very momentous occasion for us, and we really look forward not only to add huge value to the company, but also to continue to interact with you. First of all, I hope that you all and your families are staying safe and healthy as we pass through the COVID-19 pandemic, which is unprecedented in nature, and the nature is really coming back to us in its various form.
Before proceeding any further, we would like to extend our heartfelt thanks and gratitude to our health workers, police personnel, and all those who have been working relentlessly to keep us safe during the lockdown. This also includes the bankers who have been working tirelessly all through these days to ensure that the economy continues to roll. We at SBI Card are committed towards supporting our colleagues and customers while remaining financially robust so that when the crisis gets over, we are in a position to continue our sustained journey. As we take you forward, we will let you know that what all the company has done. As I mentioned to you, this is our very first meeting after SBI Card listed on BSE and NSE on March 16, 2020. The IPO has been very significant milestone for us, and we thank you for being part of our journey.
It is your continued support and the belief in the company that resulted in the issue getting oversubscribed by almost 26.5%. A record of sorts in the Indian bourses, even during the challenging times of COVID-19. We saw extremely strong interest from non-institutional investors, high-net-worth individuals, QIBs, retail investors, and obviously, the large investors that we interact with. As on date, SBI is the majority shareholder with 70% stake and Carlyle holds 16% stake in SBI Card. Before I get into the financial performance for Q4 and FY 2020, let me take this opportunity to reiterate some key facts about SBI Card, its business, and the environment we are in today. Today, SBI Card, you are aware, is the largest pure-play credit card issuer in India. We have deep expertise in India's credit card market as a result of our more than 20 years of operating history.
During these years, SBI Card has been trusted and recognizable brand in India. According to RBI, SBI Card is also the second-largest credit card issuer in India, both in terms of the number of credit cards outstanding and the amounts of credit card spends. We are also the largest co-brand credit card issuer in India. We have established a proven track record of consistently generating profits over the last three fiscal years, despite being in the unsecured market. According to RBI, we have grown our business faster than the Indian credit card market over the past three years, both in terms of number of credit cards outstanding and amount of credit card spends. This fact has been discussed extensively during our road shows that we went through in the last one year.
We believe we have achieved this by leveraging and capitalizing on India's favorable economic and demographic changes, including its strong macroeconomic performance, rising affluence, increasing consumer demand, rapid urbanization, and growth of e-commerce platforms. India's potential has been discussed at length across the globe. The story has been promising for the Indian economy, for the Indian credit card industry, and especially for us, as we were able to leverage the credit card boom and the overall digital boom that India witnessed in the last few years. The journey has been impacted, however, in the recent times owing to the global COVID-19 pandemic. Our offices across India have been closed, but our business continuity plan kicked in, and all our critical processes are running as usual, with our workforce supporting the critical business operation remotely from home.
Our digital transformation, the journey after the GE exited through an investment in technology and also in the digital platforms over the years, has ensured that our core services and operations continue running smoothly with minimal customer impact while safeguarding our employee data, systems, and assets. I think this has been an absolutely phenomenal testing of our business continuity, where during these years, our data center had 100% availability. The authorization was very high in terms of all our critical assets. They continue to perform very strongly. This goes on to prove that the investment made by the company in the digital and the IT infrastructure has paid rich dividends, and the company was absolutely geared to handle these kind of eventualities. Significant actions have been undertaken to ensure business continuity after the COVID impact and the lockdown, customer servicing, safety of employees, and business associates to mitigate the risk.
These are unprecedented times. At least in my lifetime, I've never ever seen these kind of changes or these kind of impacting the business. We are continuously monitoring, evaluating, and adapting to serve our customers in the best possible manner, and most of it is through the digital means and digital initiatives that the company has taken. Having said that, I would like to emphasize that SBI Card operates on strong fundamentals, and the industry is poised for growth. I am happy to say that our results have been very strong despite the provisions that we have made owing to our strong business fundamentals. We are very proud of our business.
Despite the fact that we are in unsecured lending, we operate under the In AS's norms, and our provisions are very high if you compare with any of the companies or any of the credit card issuers in India who operate on Indian GAAP. I think it is very, very important for the investors to understand that the comparison of the numbers are very difficult to make because we are on Ind AS while every [inaudible] card is on Indian GAAP, which is absolutely just 10% for the credit card, and you can have 0.4% on the standard assets. Let me actually take you through our financial performance for the financial year 2020, and there are also numbers that you would see that are actually there for the Q4 FY 2020. I would start from the slide number two. These are our performance highlights.
All of you actually would have seen it. Our profitability continues to be absolutely strong. Very high profitability that we have continued to exhibit in the last few years. We are reporting a PAT of INR 1,245 crore, which is a YoY growth of almost 44%. If you exclude the COVID impact, the profit would have been INR 1,662 crore, which would mean a YoY growth of 92%. I think it just goes on to prove that the business models are strong and the company, with all the investment that it has made, the data analytics facilities and the data capabilities that it has, it will continue to show very good performance. On the ROA and the 8.5% and 27.4%, ex-COVID, it would be 7.2% and 35%.
I think these performances are far better if actually, I would say, these are one-time measures. Had the COVID was not there, it definitely would have been far better in the ROE also. ROA has been higher and ROE would have been even higher for us. It's very important to understand that we work on the very strong positive operating leverage with income growth of 34% and OpEx growth of 26%. We have an operating leverage of almost 8%, which is a very, very strong indicator from our perspective in terms of the business. In terms of the market share, I think it's very, very important to actually note that SBI Card has continuously shown strong growth both in terms of the cards in force and the spends. If one looks at from 2017, every year we have had a graph which has been going up.
There are very few in the industry who have been so strong and who have continued to show an upward trend, both in actually cards in force and spends. This year, our growth has been. We are market share at 18.2%, as many of you are aware. We are the second largest player in the credit card industry. Our market share is 18.2%. Our growth has been 32%, which is far more than the 24% growth that the industry has witnessed. On the spend side, we have a growth that is almost about 30%, which again is almost 5% more than the industry growth.
I think what we have done is to ensure that we are very relevant in terms of the sourcing that we do, in terms of the value additions that we do to the customer, in terms of the benefits that we bring to the customer. Therefore, the customer, despite the fact that we are a fee-based credit card company, people continue to take our cards and continue to use our cards, and the spends have grown by about 30%. The portfolio has been growing, as I mentioned to you, continuously.
On the asset quality, if one really looks at it, I think though we are reporting a figure of 2% over here. I would say that this is a number that one would have to look at it after the moratorium is removed and after the moratorium is over because the total impact is going to be felt only after the moratorium is over. If we assume that the business was as usual and we were on March 20th, I think we would have continued to show a GNPA of almost the same or slightly lower than the numbers that were there in December, which we have reported it earlier. There are certain measures that the company has taken on the asset quality. These include the hardship tools, the hardship measures that we have taken on the retail side.
On the corporate credit side, again, we have taken major initiatives to ensure that the corporate card portfolio remains barricaded from the forces of COVID-19 and the economic downturn that one would see. What we have attempted is to ensure that the portfolio remains very strong and robust over there. In terms of our liquidity and CAR, we remain pretty well capitalized. As well as in terms of the liquidity, we have significant amount of limits that remain with us. Our CAR has gone up to 22.4%, with Tier 1 actually showing 17.1%. This definitely has been helped by the additional equity of INR 501 crore is actually we take it as INR 499 crore, which we showed it during the IPO. If we go to slide number three, one would see that these are just a snapshot of our performance highlights.
The PAT has actually gone up by 44% from INR 865. Return on average asset is up to 5.5%. Return on equity is down by 97 basis points. I mentioned to you the reasons for it because it is ex-COVID, and that is why there has been a little impact and it has come down. The CAR has again gone up to almost about 22.4%, and we feel that we are pretty well capitalized in terms of the requirements which are there on the regulatory front. Our triggers and everything are continuously reviewed, and we ensure that the triggers are never breached in terms of the requirements. The CIF and spends I have already actually discussed with you. The receivables have been very strong. All through the years, the company has made major attempts to ensure that throughout the year, there is significant growth that takes place.
If the company would not have done this and would not have actually ensured that right from April 2019, there is good growth that is there in the receivable side, probably the impact of COVID-19 would have been much higher. All the growth that was there all through from April 2019, that has mitigated any adverse impact that the COVID-19 would have brought in. The GNPA is at 2%. I would again say that we are monitoring the position continuously. We have taken adequate measures. We would have been otherwise close to December 2019. All that you will see, I think only a time would tell how strong our risk management tools are. If we just move to slide number four. I just want to take you through actually the initiatives that we have taken.
This is a company which we have always maintained that it should be a digital company, it should be an analytics company, the efforts that have been made are to strengthen the IT infrastructure, the digital push, the customer engagement that is there. Right from carding that you look at it, the digital platform that we have created for ourselves, the intellectual property that we control, the YONO apply journeys that we have built, the YONO journey with SBI that has been built, these are all completely digital journey within the norms set by the regulators and the legal approvals that one would have in terms of eKYC, in terms of CKYC, in terms of video KYC. All these things have been taken into account wherever wet signature are required. Otherwise, if one would look at it, we are a completely digital platform that exists with us.
In terms of our engagement with the customer is very important from our perspective, both for portfolio management and for actually spend purposes. We have made major changes in the way we were operating. We have enabled the digital payments. We have e-Cards. We issue cards on the Android phone. Actually, during the last two months, there has been a major advantage that we have been able to generate because of the e-Cards as the renewals, the lost card, and many other times that you have to do where we have to send an embossed card, a plastic immediately, or a metallic card immediately. We have been able to ride on the e-Card, we have been able to transfer the card to an Android phone immediately.
The green card and the host card emulation are a huge step forward in terms of not only starting the journey for the transactions through the generation of PIN. Host card emulation helps us significantly in the tap-and-go business where the customer can start transacting very quickly. In an environment where it is social distancing, people want to keep everything away. They want to either give exactly the change that is required for a transaction, or probably just not even hand over the card. I think these are some of the things which are very, very significant or of purpose.
I would like to assure all the investors and all those present, and many others well-wishers, that the company is absolutely geared to handle these kind of things and probably will bounce back with a far greater force in terms of the digital push that it is going to bring in. The data analytics that the company uses are significant. It is just a few of them that we are mentioning, whether it is targeting offers that one would like to do in a specific location. We can give targeted marketing offers or is it sales location analytics. If one of our employees is working at some place, what kind of location-based offers I can give to the customer and what kind of support I can give to my employee in terms of the engagement and the movement that we have.
It is inward-looking and it is outward-looking both. In terms of the digital servicing, our mobile application continues to be rated amongst the best in the financial industry amongst the banks and others at 4.7 and 4.8. We have actually now a powered AI Drishti, which actually helps in servicing the customer accurately once and every time, and it gives the correct answer because at the press of button, our operator can invoke a FAQ for that particular product or that particular query that the customer is asking. This chatbot, Drishti, is being extensively taken forward to ensuring that it is far superior in terms of what it provides to the customer service agents and across the organization, whether it is employee, it is customer servicing, it is collection. We go forward, you will see huge amount of changes being brought in.
On our Ask ILA and the RPA for efficiency, the chatbot ILA has seen a traffic increase of between 40%-60% during these days. This has been a boon for us in terms of the self-servicing it does. In fact, in the time where all our offices were completely closed and there was nobody to service on the IVR, actually by pushing these messages across our customers and asking them to use our facility through the ILA, we were able to enhance the capability of our agents sitting from home, and they were able to service these kind of queries. Even if the chatbot, it is 97.5% right every time. Where it was not able to respond, we were able to immediately respond sitting at home. I think what we have been able to achieve in terms of the digital initiatives is very strong.
If you look at the work from home, at the time about two months back, we were geared to service only 700 employees from working outside the offices. Today, because of the COVID, we have been able to extend it to 5,000 people at any given point of time. The VPN-based setup can accommodate 500, and we are only 4,000 employees. You can very well see that what we have done on the VPN and the servicing that we have actually done it without compromising anything on the risk side. We have been able to provide uninterrupted services for our customers for all these 45, 46 days that India is closed. Just jump to slide number five. I want to talk to you a little bit about the growth drivers.
Some of you will find it a little repetitive. The purpose is that people must understand in these trying times how actually the growth drivers are going to augment the capabilities of the company. About one and a half years back, we were very strong in terms of the e-sourcing that we used to do, the e-sign that we were allowed at that time, and the KYC and not the video KYC, but eKYC and other things we were always capable of. We had to make some changes because of the environment, because of some of the decisions that came from the judiciary. We are now back on the e-sourcing front because now more and more people are coming forward and they are themselves generating.
Our systems are completely geared to handle the e-sourcing part, which is the organic traffic that comes either on our website or the inorganic traffic that walks in through our partners. On the open market, we are leveraging, I think it was mentioned with the Sales24, the location-based and all those things. It is only this that actually helps us in moving people, especially in the green zones. We have started our operations in the green zone, and we are able to move people very dynamically control our workforce. On the banca side. We have continued to actually show very growth numbers in terms of the YONO today. The YONO actually itself is generating massive numbers for us, and it is a result of the last about six months of effort that we have put in.
Our intention was to bring in maximum amount of sourcing from State Bank of India through the YONO platform. I think the advanced analytics, the AI engines, the machine learning that run across the organization when leads are generated, all these have helped us significantly in terms of what we do it. Similarly, if you look in terms of the risk that we manage, we have taken massive steps in terms of micro-segmenting the risk, the portfolio. This micro-segmenting has been done from the perspective of acquisition as well as for the portfolio management. As we go forward from tomorrow onwards, actually, from 17th or 18th if India opens up and the lockdown comes to an end, we should be in a position to actually very easily tell the sales force where we would like to actually put our force for sourcing purposes.
I think the micro-segmentation that we have done for acquisition will help us significantly. The same thing has been done on the portfolio side to ensure that the risk models are improved, the risk scores are improved, and we see to it that when we are actually going to give sanctions, these are factored in very, very strongly. In the underwriting, we have started using machine learning for quite some time, and this has helped in few things. One of them, it adds speed to the whole process of underwriting automation because there is significant number of credit applications which goes straight through process without the underwriter looking at it. The second is that it also helps us in improving the score and seeing that what best we can do in terms of improving the overall underwriting analytics that we run.
The robots, we have many times told that we have robots that are running. These on the risk robotics. We have two robots which have helped us significantly. One of them is on the transaction monitoring side, and this has helped us significantly in terms of monitoring, calling, talking to the customer, dynamically controlling the environment. The second one is in the fraud control, fraud management. Fraud management, I think the company feels very, very proud to say that our fraud rate is almost 50%-60% lower than the industry. I think this is what we will continue to strive. We are not going to actually sit on our laurels. We will continue to work hard to improve every system that is working in the company. The advanced collection, the CRM that the company is setting up, the last module comes up..
One of the last two module will come up in the next one and a half months. However, the CRM modules that started going live from September onwards, they have helped us significantly in actually starting the operations very quickly. Why I say is because one is that the sales came to a grinding halt, and the second is that the field collection also came to a complete halt. It is at that stage that our CRM platform and advanced collection measures that the company had taken, these helped us in very quickly bringing in thousands of telecallers on the collection side. I think one thing that the company has always said is that it is going to continue to invest heavily on the IT and the risk management, sales, and the collection.
One of the reason is that it is very important to go and collect. This company actually has a very, very robust collection mechanism, and that is where we are able to ensure that we increase our collection machinery and collection amount that is there. Despite these trying times, we have been able to do a fairly good job. I would not say that it is the best it would be, but there has been a significant improvement despite all odds. The industry is continuously asking that what SBI Card has been able to do, and there are many who come and ask us what can be done. On the technology side, the digital journey is a complete transformation that we are looking at. There is a remote workforce we spoke about, and advanced analytics remains a significant part in terms of the way we are going.
In terms of the customer engagement, the robots that are working over there, the artificial intelligence that goes with that we have created in terms of personalization, in terms of extending the Radar, which is a very significant step that the company has taken for its retail customers. What we do is that in case of any issue, you are stuck at some place and there is through. Earlier, we were only servicing our corporate customers.
We have taken the Radar to all our retail customers. Depending on the gravity or the severity of the issue, that again, which is decided by the micro bot, we would either send a message to them or we would ensure that it is actually somebody, that the caller who will call a customer. I think at the end of the day, it's very important for the company to ensure that the productivity improves continuously. Our sales force effectiveness, our workforce effectiveness, our cost control measures that we are taking, and today we are looking very closely at any of the cost control measures that the company can go ahead and work on. I think we have done significant amount of job in terms of the contracts, in terms of the rent that we could actually, during the close down, what kind of negotiations we can do.
Therefore, we feel that there will be significant amount of cost controls. We are not saying that we are going to cut costs, but we will ensure that wherever it is required, costs will be incurred, but we would not like to incur costs which are absolutely of no use to the company and only going to eat away the profitability. Can you take to the next slide number six? This slide actually covers on the left-hand side is the business impact and the COVID-19 response, which I think these are very important from the perspective to have an understanding of the results also and where we stand today. We used to do every day almost 10,000 accounts. Every day 10,000 accounts with a peak level of almost 30,000 accounts. There have been days when we have been able to sanction 30,000 accounts also in one day.
In the second half of March, the COVID impact actually started till, I think, 16th. We were also not that aware. Our IPO opened. COVID was a word, but nobody felt that there is going to be any such a big impact. If you look after 20th, there has been a significant drop in the number that we are doing on the accounts. We did 4,000 accounts per day from about 20th till the 31st, and during April also, because of the numbers that we had, no new sourcing was done. There has still been some big curing that has been done of the accounts, and we have been able to generate some numbers, and they are significantly higher than our competitors.
In terms of the spends, till January, February also, if one really looks at it, we have given you the mid-20s number for INR 376 crore of spends every day. It came down to INR 256 crore, which is extremely low from our perspective. If you look at transaction per card, spend per card, all of them all through the year gave very good numbers to us. In the second half, these have come down significantly. In April, it initially in the first few days of the lockdown, it did show a huge uptake, but then it tapered off for about 7- 10 days. After about April 10th, we are again seeing a big uptake in the numbers. I'm not saying that they have reached the same levels. This is what it is.
What has happened is that the repayments have come down because of the moratorium announced, and many of the customers' transactions, they have all the EMIs, they have held back their repayments. However, we still actually were receiving INR 316 crores per day, and there were no spends taking place, and we had to actually continue to repay our debt that we had taken, and the treasury operations very clearly reflect that we have brought down our outstandings. Our unutilized limits have gone up. However, it is just a temporary bliss. As we anticipate that within the scenarios that the company has built itself, the base scenario, the medium-risk scenario, and the severe scenario, depending on the severity, the extent of COVID, the company should be in a position to respond very quickly with these available limits, with the kind of infrastructure it has.
On the right hand side, you will see the COVID responses that the company has come out with. The moratorium, as per the regulatory forbearance, the moratorium has been extended to whosoever wanted to opt in. Anyone who actually defaulted, he had an option as per the policy approved by the company. They had an option of actually automatically getting into the moratorium. There is a moratorium that is there, which is compliant with the Reserve Bank of India guidelines that have been circulated. The sales in banca. The open market sales came down, on the banca sales, we have been able to start the operations now. The digital has come back with a resurgence, and we are seeing very good numbers. Our response has been that we have been able to immediately scale up the capability for digital sourcing and the e-sourcing.
On the risk side, I have spoken to you that there are a lot of hardship measures that have been taken. We have identified accounts, we have reduced limits, we have made additional provisions of INR 489. These are all based on the Ind AS norms and not on the Indian GAAP. There would be a huge difference. One would look at it. I think the silver lining for providing this would be that next year the company is fully prepared in case of any eventuality. I think that was the purpose, to ensure that the company had the sufficient provisions to tide over the eventuality. If everything improves, this will go back, and this provision can either be used for other purposes or it will be written back.
I think the possibilities are pretty good in terms of the additional provisions that we have provided for the COVID. On the COVID, on the collection side, I mentioned to you that the collections have come to a halt. Telecalling is doing pretty well. Very large number of agents are working from home. They're using our cloud-based operations. We have masked a lot of fields for customer information, and they can only see very few information, the numbers, the irregularity and all those things, and they started calling it. I think overall, the strategy has been completely revamped, and as we will move forward during the year, you will see major changes or initiatives being taken in the collection strategy that the company is going to come out with. On the employee safety side, we have taken all measures. All our offices are closed, 12 offices.
We have ensured that the employees are safe, their families are safe. We have a medical advisory. There is significant amount of messaging that goes through the emails, through the WhatsApp to our employees. We are continuing to help them. We have ensured that the medical insurances that we have are completely active. If there are health, the HR is in a position to provide those health or actually garner support to the employees. I think our employees are one of the biggest asset of the company, and we remain completely committed towards our employees safety and health considerations. IT and infrastructure, I think it remains very strong. We will continue to build, and I think we will also ensure that these are rolled out even at a faster pace than actually it has been done till now. Liquidity is strong.
I mentioned to you it's not only actually the unutilized limit that we have, but we also have options of increasing it. We continue to be an AAA company, and we'll ensure that YONO continues to have the highest rating that is there. Please go to the next slide. This just gives you, I don't want to spend much time, but you can very easily see that from 2016 - 2020, every year, we have been able to increase our market share both in cards, in force, and in the spends. We will continue to work towards these things in building the customer's confidence, the trust, the transparency that this company brings to the customer, and the value addition that it does to the card by bringing in offers, by bringing in relevant offers, the location-based offers.
These are brought in such a way that the spends continue to increase without over-leveraging the customer. I think that remains very important objective of our risk management and the spends and the upselling and the cross-selling that we do. The next slide actually takes care of the accounts growth, and you would see that we have shown a growth of 20%. From 2.8 million, the accounts in force have gone up to 3.4 million. New accounts have gone up from 2.8 million - 3.4 million. That is a 20% growth. However, if the COVID-19 was not there, we would have grown by 24%, because there is 1.3 lakh accounts more that we would have actually very easily converted, which was in the pipeline and what we would have sold into accounts. I think we probably could have shown even far superior results than what they are.
On the channel split side, if you look at it, we have always maintained that we want an absolutely fantastic balance between our banca, SBI, as well as on the banca side and on the open market, which is absolutely matching. It has actually from 44, it has climbed to 50. The kind of opportunities that open market has created for itself, the kind of digital push that they have brought in, the kind of emphasis on the co-brand that it has, which remains one of the cornerstone of this company. All these have helped it to regain very strong numbers. This is a mix that is absolutely what one would look at it. Going forward, we'll have to see that the social distancing, the opening of malls, railway stations, airports, common places.
I don't know how much impact it can actually bring in, but our intention would be that whenever it opens during the year, we try as much numbers as possible. I mentioned to you earlier that the green zone resourcing has started. We have mapped all the 700, 800, 750 districts of India zone-wise, and wherever it has been opened up, our business has started and we are back in it. We have ensured that employees are safe, our offices are sanitized. There's proper fumigation. There is everything possible that we could do because that is very important from our perspective. On the CIF, we crossed the 10 million mark last year. December, January, we had crossed it. We have grown by almost 28%. On the channel-wise split, it is 38.2% for SBI sourcing, which is actually the sourcing.
On the left-hand side, what you look at is actually the accounts. On the right-hand side is what the sourcing took place. The open market sources more application, but the sanction is slightly lower for open market. Banca because of the way it has been set up, because of the protocol and the information that comes on the application form that is coming on the banca , is far superior and far better in terms of the parameters that it captures and the conversion rate becomes higher. Next slide, please. This is our portfolio growth that we have actually seen. In terms of the spend, there's a 27% growth. This is up to the lockdown..
There was for one few days, I think 27th, 28th, we saw huge shopping taking place on the stores where people were going, and we were actually buying lot of stuff for inventory purposes. Subsequently, that completely tapered off. This year, we have actually come out with a 27% growth. This growth comprises of retail growth, which is at 39%, the cross-sell, which is at 11%, and then you have corporate. The corporate has shown a - 4%, majorly because of few reasons, and we can discuss it at any given point of time. The spends per card have actually again come down. It's all to do with the COVID impact that it has. There was a big campaign that was to kick off somewhere around March 24th, 25th, which have resulted into big gains for the company.
Because of the lockdown, we were not able to do it. In terms of the receivables, actually, the receivables has grown by 30%. What has happened during the year, especially in the last 10 days, is because the transactors were not able to, or any old cardholders were not able to spend, so the receivables did not grow, while the repayment continued to come. Otherwise, we would have seen even a far better result than the 30% growth that you see. The receivable per card is just 2%. This again, would have shown a slightly better number if we would have not had the COVID. I don't want to ascribe everything to the COVID impact. The company has done significant work in terms of ensuring that these numbers are on the positive side.
If we would not have worked, especially in the initial phases right from April, these numbers would have been very adverse for us. Next slide. These are our financial results. If you look at, the income has gone up by 34%, the finance cost has gone up by 29%, the credit cost has gone up by about 69%, operating cost. I think very important thing, if you look at the bottom of the table, the cost to income has come down significantly. I think this is very important from our perspective because all through, we continued to work on the cost side also while the company was growing even. These numbers are even better than the December numbers that we had showed and we had mentioned in our various returns that we have submitted to the regulators.
I think what we will do is we will continue to ensure that we control the cost in such a way that the business is never impacted. The gross NPA, 2.01% ROA, these things we have already discussed. The earning per share is at 13.3%. On the PAT, if you look at it, we are showing a profit after tax of INR 1,245 crore. This is a 44% increase over last year. However, if the COVID was not there and we would not have made this provision, the profit would have been INR 1,662 crore. This is about INR 417 crore after the above. What you see below is INR 579 crore, which is actually split into INR 90 crore of late fee reversal that we have done based on the regulatory forbearance, the regulatory package, and the impairment losses are INR 489. Provisions that we have created.
I think instead of losses, this is what I think they use in their terminologies. It's a provision that it is there. For INR 579, the impact on the PAT would be INR 417 crores, and our growth could have been very good this year. I wish that the COVID had come after March. The next slide, please. These are we have actually mentioned to you. But the interest income has gone up. This is actually the PAT. We are showing it to you. At 7.2%, beyond total income has gone up basis points. For the finance cost comes down to INR 205. As you go down, actually, the ROA comes down to 7.2%. Ex-COVID and ROE ex-COVID is 35%. I think these are the numbers that we have. There have been some that the company has been able to garners.
One of them is on the deferred tax purposes, and the other is actually, we had rolled back about almost INR 162 crore of the rewards provision that was there. These two have also helped the company to achieve these numbers. Next slide. To look at the revenue compositions, 52% of our revenues come from interest income. It has gone up to some extent. A 19% continues to be subscription-based, 7% is subscription-based, and interchange is about 19%. The spend-based is from 23%- 22%. These are numbers which are a little, I would say, if you really remove the COVID-19, these numbers would have been almost the same. We have been able to maintain the composition of the revenues, and we have been able to ensure that the revenues continue to grow. The revenue from operations has grown by 33%.
Other income has grown by 65%, the finance cost and interest. Another important thing that one needs to see on this slide is the interest yield has gone up from 21.6% and 22.7%. This is something that we can talk in case you have questions. We can talk about these things. The cost of funds has gone up to some extent, which has more to do with the opening, closing, and a lot of other things. The net interest margin has improved from 15.5%-16.6%. I think these are some of the things that we are actually looking at it, and we feel that we will be continuing to work and ensure that the numbers are good. Next slide. I now take you through the cost of funds, the financial leverages. If you look at the borrowing mix, we have 59% is of the bank lines.
The commercial papers were 15% and debentures. We continue to scout the market and see in case ever we have call options on the debentures, we are prepaying if it is a high debt instrument. Wherever it is possible, we are using the limits to ensure that these things continue to be. One second.
Just one-
Let me check, Ray, whether we are audible. We received some messages that the sound has dropped.
We can hear you, sir, but there seems to be a slight beeping sound while you speak every few minutes. Possibly a few keys being pressed.
Okay. Ray, I have pulled the mic closer to me. Is it slightly better now?
Absolutely. We can hear you loud and clear, sir. You may go ahead.
All right. Okay.
Okay. We'll go ahead again.
We are also switching off some of the background air conditioning sound. We are a AAA company, we continue to maintain our liquidity and overall strength of the company. We will look at whether it is cost of funds, whether it is cost, financial leveraging that we have. All these we are ensuring that they remain very good. The equity infusion and the net loan funds, they went up and the NPA came down, which has resulted into this leverage, financial leverage actually showing a little bit of a lower number. Next slide. I think this is something which is very structural liquidity. One second. Okay. On the structural liquidity part, we have ensured that no negative mismatches are there with us. There is a robust ALM. There is positive cumulative mismatches. There is no negative.
A INR 3,702 crore of sanctioned lines available with us for drawdown, which would mean that if we want to hit the ground, we can hit the ground running, and we have all the limits that are there. I think these are some of the important things on the structural liquidity part. We will continue to monitor the position, and we'll continue to ensure that the structural liquidity is continuously maintained. The ALM and the mismatches or the matches are within the bounds that have been set up by the company and the regulators. If there are any, we always ensure that there are triggers in place. We are managing it properly, and all of this is reported continuously to the Reserve Bank of India.
Even including when the announcements were being made, the structural liquidity was being continuously monitored by the regulators, and they were in continuous dialogue with us in terms of finding out whether there were any problems on the liquidity side. Next slide. This is, I think, sir, a very important slide from the way the operating leverages have improved. If you look at it from 3%, we have actually reached almost about 8% of the positive operating leverage. It just means that our income stream continues to grow faster than our operating cost. This is what we want to continuously do, where we are actually income streams are higher continuously, and we remain the operating profit. This is going to help us significantly to improve our business, and it just goes on to prove that business is moving in the right direction.
Cost to income is therefore improving for us, and these are some of the important learnings and these are some of the important thoughts that I would leave with you from this slide. Next slide. Okay, we have spoken about the GNPA. Our PCR remains at 67.2%. The provision coverage is high because we are part of the Ind AS. If we would have been in Indian GAAP, only 10% is required to be provisioned. It would have been very low in terms of the Indian GAAP. I think this Ind AS is going to help the company in ensuring that you have sufficient provisions sitting over there for any eventuality if it comes. In terms of the gross credit cost, the impairment losses and the gross credit cost. The gross credit loss percentage has gone up from 6.2%-9.1%.
There's an increase of INR 288 due to do with the provisions. The net credit cost has actually increased to 7.7%. We will take you in detail as we go. I think there is going to be a lot of questions, and we want to take you through during those questions also when we look at these kind of things. Next slide. This is just a shareholder summary. I think you can go through it. Many of you, most of you, would have downloaded it. Don't want to take you through these names, but these are the top 20 shareholders of SBI Card. Slide number 18, which is actually the historical numbers. We have given all the historical numbers to you, and we'd like you to actually move forward into slide number 19.
This again, I think these are the numbers that we have already discussed with you. That brings to an end our webcast in terms of what we wanted to present. We would be very happy to take questions from any one of you. Thank you very much for actually listening to us. I would request the operator if you could open the lines for us. What we will do is that we will ask our senior management team is also sitting over there with our sales and marketing, and the risk head, and the chief financial officers, the chief operating officers sitting over here to answer any specific questions that you would have on the performance of the company in terms of how it has responded and all those things. I request Mr. Ray to kindly open the chat.
Sure. Yes. Thank you very much. We will now begin the question and answer sessions. Anyone who wishes to ask questions may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask questions, please press star and one. We take the first question from the line of [Aarav Sanghvi] from B&K Securities. Please go ahead.
Hello, sir. Thank you for taking my question. I had a couple of questions. My first question being that you have a significant portion of your spending, roughly around 25%, coming from Corporate. Could you give us a breakup of the receivables into Corporate and individuals and what are the risk return characteristics that you see in the Corporate portfolio?
The Corporate receivable is negligible. It's, I think as on 30th, 31st, it is less than INR 100 crores, if I remember it correctly, INR 53, INR 54 crores only. The corporate is negligible. What we have also done is wherever there was a possibility of any increase or if vendor kind of a credit card being used for vendor financing, those also we have converted into T&E. I think what we have done very strongly is to ensure that these corporate cards are used only for the purpose for employees and others and not used for actually either buying assets or buying inventory or things like that.
Sir, just a follow-up on that. There was some kind of a INR 92 crore write-off, I believe, on the corporate portfolio. Could you enlighten on what was that?
I would not like to take you through because that's part of that. It was also there in the DRHP. You can actually go through it. The write-off took place before September. It was a Cox & Kings account, so that has been written off. There's a huge overall banking exposure that was there. We also had this INR 92 crores, and you can find those details over there.
All right, sir. My second question is on the recovery rates. I just wanted to know what are the recovery rates that you see on these revolver portfolios, which ultimately fall into the NPA category?
I request from the CFO to respond.
All the accounts eventually, before they get written off, become revolver. From our past experience, we almost recover 35% of it within the first three years. Very important.
Sir, speak louder.
Could you hear me?
Yeah. Got it. 35% is what we can expect on the additional NPAs as well that might arise.
In the first three years itself, and then there are recovery operations are ongoing after that as well.
All right. Sir, my just final question, I wanted to understand on the sourcing. In terms of the direct channel and the open sourcing, what are the cost and risk differences? You have been growing pretty fast in the open channel in the last one year, I believe. I wanted to know what the cost structure is there and return objectives?
I think we do not come out separately for our open market as well as on the banca. Those numbers are not disclosed by us. However, if you really look at it, the number, the difference could be anything between INR 800 - INR 1,000 actually between the two.
Fine, sir. That's it.
Open market has its own because there are costs involved. Somebody is sitting at the airport, very expensive space. You are at malls, you are at stores, you are at theaters. Obviously, there is a cost involved for that purposes. However, for the banca channel, most of the sourcing is coming from State Bank of India, which does not charge us anything for our employees to be there or our non-full-time employees to be sitting in their branches then there is a charge involved. There is a little difference in the way the business is done.
All right, sir. Thank you so much. That's it from my side. All the best.
Thank you. Thank you very much.
Thank you. The next question is from the line of [Amit Singla] from Bank of America. Please go ahead.
Yeah. Thanks for the opportunity, sir. This is [Anuj]. Sir, firstly, on the costing side, if you can just give some color on what kind of flexibility, do you have on the costing side in case the spends were to weaken in this year? Like you mentioned, the trend in the second half of March is very weak. What kind of flexibility do you have on the costing side, especially on the sales promotion? Should we anticipate more sales promotion for you to incentivize spends, or we will see a decline there and other cost levers as well?
Actually, it goes with some kind of a percentage of the total spend that we would have, and all the cash backs or on the spend-based offers that we have, those are always capped, and they will continue to be capped. It is not there that it is the amount that has been fixed. It is actually the percentages that we pick, and we allow expenses only to go up to that level. We are always tightly controlled in terms of the cash back, the spend-based offers for everything that we do. We'll continue to do it. We are also looking at opening up of new categories as we see as the business improves, as the digital push comes in. In fact, actually, we feel that this could be probably even a far better moment than demonetization in terms of conversion of cash into digital.
If that happens, I think we probably in the next three, four months, assuming that COVID-19 impact, the lockdown is removed on 2020 and life comes back to normalcy in next three months, we still feel that there could be a big uptick into the spends. However, it's very difficult for us to say how it is going to pan out, what is going to happen. I definitely am in no position to give you any kind of guidance what would happen unless we know exactly what is going to happen. What we have done is that by creating these additional provisions, we have ensured that the company is barricaded from the losses in case they come up. Hopefully, if the collection machinery goes up, it really fires on all cylinders.
The credit culture that exists in India, there could be significant amount of recoveries that would come in. Even the numbers that we have shown in, out of the numbers, especially the transactors who had actually opted for the moratorium, within the first 10 days itself, 25% of them have come back and have deposited their money in April. I think we feel that there has been an uptick from almost about INR 370 crores that I showed you per day spend. We were down to almost about INR 100 crores, and then we are back at almost about INR 180 crores, INR 200 crores. I think we are seeing that the business will improve, and we will keep the spend-based cost under tight leash.
Sir, is there some value to order fixed cost, maybe FY 2020 fixed cost, what kind of number we can look at? Is there some color you can share on that?
See, in our business, it's very difficult to categorize some of the cost as fixed cost or a variable cost. If you look at it, some of the costs are definitely variable, the ones Mr. Prasad mentioned, cash back, et cetera, because they're linked to the spends that we're generating. Most of the other costs would either fall in the bracket of fixed or semi-fixed. One could say that our sales force is variable, you look at the situation right now, even though we didn't source too many accounts, we still had people on our workforce because one is that the business will come up and then we will require them. All those costs cannot be termed as variable. They are in the semi-fixed region. Fixed costs are very small for us.
These are in the nature of projects or the expenditure already done, depreciation coming, or the rentals, et cetera. That will be in the region of 15%-20%. The semi-variable cost will be in the region of almost 45%-50%, and the balance of the cost, 30%-40%, is in the variable nature.
Understood.
I think one important thing to remember is that because the Government of India mentioned that you need to continue to give full salaries, we have continued to ensure that those salaries are paid, rents are paid wherever we had taken, despite the fact that there was no business that was taking place. What we have not paid any variable pay over there because there is no business over there. Obviously there is going to be a shift in the overall business mix, income mix, cost mixes that you are going to see. I think by September, you would see a complete picture of how the business is going to shape up.
Understood. Sir, my second question relates to the sourcing mix. We have seen a decline in sourcing from SBI, which has been increasing for the last two years. Now it's back to a 50% kind of run rate in FY 2020. Any reasons you can share for that, sir?
I don't think there has been a decline from SBI. It is the open market. It is a contribution that we are looking at it. The open market has been able to build its co-brand franchise very strongly. It has invested heavily on the digital side. It has augmented its number on the POS side. They have consolidated all the tele operations from about 56 tele calling centers to 12 call centers and brought in major productivity changes in the way the business is done. I think that is one of the most important things. In terms of the business that we do with SBI, it will continue to show very good growth. In fact, there is a strong possibility that the banca business can become even stronger than what it is today.
Because there are a lot of things that in case I cannot build the open market because of the spacing, because of the social distancing, because of the lockdowns, I definitely will have to look at options of going ahead with the banca. Reallocation of resources will continue to take place. Wherever we feel opportunity, we will move people and ensure that these numbers continue to show us very good growth.
Understood. Sir, lastly, can you share some color on what kind of spends will be discretionary in nature for you, discretionary related to maybe travel, air travel, or eating out or dining? Any color you can share on that?
I think as far as the travel entertainment is concerned, it is almost to a grinding halt. I don't think that these spends and others are going to take place in those categories for a very long time. There is a lot of these also business travels that come in. I don't think that a lot of people are going to travel now. The new norm is going to be through the VCs, through the Microsoft Teams, through all these Cisco Webex and those kinds of the WeChat. I think it is going to make a big difference in terms of travel. Entertainment, I don't know when the hotels and the restaurants are going to open, but that again, is one category we don't anticipate that for at least about six months out till September, these are probably going to open up to a significant level.
I think what we are looking at it is actually creating new categories. I think these new categories are more important today than how do you create. We are seeing a major change in the way the people are paying their bills. It may be small value utility bills, but these are very sticky for a customer. For us, it helps significantly because once you start making your utility bill payments, you actually start using the same card at many other places. I think that's one thing that we are seeing, that there is a major shift over there. Online education is what we are seeing again. There's a big change that is coming in the online behavior. The customer is. We are seeing that the payments will move maybe from the cash to the Visa. I think that's another major change that will come.
I think we did not show the slide. The tap and go, which is actually the NFC-enabled terminals. Visa and the Government of India, Reserve Bank of India came out, they've increased the limit to INR 3,000. Visa has said that all terminals in India will become NFC-enabled by March 31st. I think we see more and more small value transactions also taking place through tap and go. These are very important for a transaction company. We being a transaction company, I would like you to use my card more often than actually doing it only for a large value transaction. I think those are some of the changes that you are going to see as we go forward. We are monitoring each and every category.
We are creating new categories along with the partners to see to it that the business actually captures some of the cash also into the digital side.
Okay. Sir, any numbers you can share? What kind of proportion will this contribute?
We cannot share any numbers because we do not know the impact, the severity of the COVID as of now. There is a complete lockdown. There's very little that is happening on the POS terminals today. Most of it is coming actually from the digital channels, spend that is taking place. Very difficult to say as of now that what is going to happen. Probably in next few months, if the lockdown goes away and is more information available on the severity of the COVID or the normalcy to return, we would be in a position to tell you that what best we can do in terms of the spends behavior that the customers are going to exhibit.
Sir, just the last one bookkeeping question. What kind of percentage of customers applied for moratorium for us?
What kind of?
What percentage of customers have applied for moratorium on the credit cards?
As of March31st, I think eight lakh customers had applied.
Yes.
A 8.4 lakh customers had applied for a morat which is auto-enrolled. Is auto-enrolled or you actually opt in, either of the two. I also told you that 25% of those have actually come back and repaid in the first 10 days.
Understood.
This is about 10% of our total accounts in force. If you have 10 million accounts, about 890 approximately, those have used it. This is something, the first rush when the Reserve Bank of India came in, many of them said that: Okay, we are going to do it. The day they realize that they are just postponing the repayment with the interest and with possibility of another fee added to it, they come back immediately and repay it to you.
Okay. This is as March 31st , 8.4 lakh number.
Yes, sir.
Okay. Thank you. Thank you very much.
Thank you. The next question is from the line of [Subrahmanyam Vishwa] from BOB Capital Markets. Please go ahead.
Hi, sir. Thank you for the detailed presentation. My first question is, what percentage of customers would you have a lien on through our bank account on the savings account?
We have 2 million accounts that have come through the Project Shikhar. It is not a lien that you enter in. I don't think lien would be the right question over here because I would not have the lien numbers. That is a secured card, and we don't actually believe in.
No, soft lien. I'm not talking about the hard lien, sir, but the soft lien.
I understand that what you are saying is. What I'm saying is that out of about 4 million bank customers that we have, almost 2 million have come from the Project Shikhar. All those accounts definitely have a auto debit for us. The remaining 2 million also will have some auto debit numbers with us. There is a significant number where auto debit is there. These auto debits are actually being invoked. Unless the customer says, comes back and says: No, I want to actually use the moratorium and please do not generate the auto debit through the ECS or the bank transfer directly through a branch which is situated within the premises.
Is it a fair understanding that of these 2 million customers we have visibility on their cash flows?
I would not say that I have. If they are outside the bank, the bank does not share any information. I would not say that I have a visibility. We have no visibility. We are outside the bank.
Right. The bank doesn't share the core banking data with us, right?
One second, actually, your voice was breaking, if you could.
The bank doesn't share the core banking data with us. Is that a correct understanding?
No organization will share it. Bank is very clear on that count.
Sure. Sir, my second question is, if you can explain maybe collection infrastructure you have, how many people, how many agencies, what kind of incentives are given, whether it is on volume or value. This will be very helpful.
Sir, we have two or three kinds. We have these field collection agencies that work with us, and we have telecallers who work with us.
Okay.
All these put together would be significant. I would not have the exact number, but it would be anything between 4,000 - 5,000, either a field or whether it is a collection agent sitting over there or telecallers working over there. Please let me know if these numbers are okay with you.
Sir, I want some more details. Are these exclusive agencies? Are they paid based on volume or value?
Field collection agencies would be exclusive for us. We work with them in terms of what is required. They will work with us in terms of how the recovery will take place. There are people who would go, and it is very expensive to go to a residence to go and collect, which is completely at a standstill. Many of them we have converted into telecallers as of date to start calling and they can actually take and interact with them so that then we then send them information how they can remit the money either through our mobile app or through the bank channel, through internet banking, through the YONO applications or wherever they can actually use those facilities.
Sir, they are paid on volume or value?
Let me just add that there is a telecalling setup and there is a field collection. Field collection gets paid on the basis of the value that they collect, and there is a percentage, there is a grid. Our contracts with them are exclusive. Our grids are exclusive. They may be working for someone else also, but our contracts and our grid is exclusive for our this thing. Similarly, we have telecalling setup, which exclusively run for us. They contact customer on our behalf and get the money collected.
Sure, sir. Just last question, sir. If you can, please enlighten us on any kind of negative category of customers that you do not cater to, which are in your negative category, or any negative geographies that you do not cater to?
Yeah, you would always have a mix. You definitely would have a type of customer that you would not like to onboard. Actually, overall, it's an overall grid that you look at it. There is information coming from the credit bureau, there is information that is sitting in the organization, where we do a dedupe. There is application scores that comes in. There is surrogate information that comes along with the application. There are risk matrices that have been designed. All these put together will come. Yes, there are actually some scores that you would not like to do it based on the performance, and that is actually nothing but flowing from our portfolio.
We know that the moment the system does a dedupe, it knows that in this particular type of customer or this type of category or this type of geography, there is very high risk sitting over there. These will be taken care of by all these things.
Sure, sir. Just one last data keeping question. How many cards have they decreased the credit lines out of the cards in force that we have? Total number of cards that we have already decreased the credit lines.
We can't give you any specific details on this case, but let me assure you that wherever required, necessary credit actions have been taken by us. We can't give you specific details.
There's two things I want to add, and you have to remember that it's a question of hardship tools that any organization is going to exercise. At any given point of time, it is not that this is the first time that this is happening. You would always have, based on the performance of an account, you would have your hardship tools being invoked. Whether it is actually stopping to give him offer, whether you want to actually make more calls, certain type of transactions being declined. Now, these are some of the measures that you would start with. Reducing the limit is the last option that you would have, or canceling the card is the last option that you would have. What you would do is that you would put that. That is where we do that micro-segmentation that we do.
These micro-segmentation will actually decide where he is sitting and what kind of hardship tools or hardship measures I will take. These hardship measures are very important, so it is a continuous exercise. And I would say that every organizer—there was a news item that some banks have done it, all that, but I would say that it is something every credit card company would always do to protect itself.
I understand that, sir. If you cannot give me the quantum, just give a yes or a no if you've done it or not.
Sir, it has already been done by the organization. It's regularly that we do it, every week or every day also we might do it. That is where we have also put in some bots that we do. We have put our bots in terms of the transaction monitoring. I did mention to you when we were talking about the digital push that we were looking at. This is where these things trigger, and this is where every day, every POS machine, every transaction that is taking place is being monitored every day. Every time I am going to actually profile him. This is the way we have monitored it.
Sure, sir. Thank you so much.
Thank you. The next question is from the line of Rajesh Kothari from AlfAccurate Advisors. Please go ahead.
Sir, can you tell us in terms of, you mentioned that you have drawn three scenarios. What are the various assumptions and what impact it can have on the provisions and credit cost under each of the scenarios? That is number one. Number two, what I wanted to understand that if I look at your ALM, zero to 30 days. Basically, when I look at that size, and suppose that entire goes to the moratorium. Does it mean then you have to create, and suppose there's some slippage out of that, then how basically the things will work out in terms of the provisions? If you can give some color on that.
The scenarios have been built based on the assumption and the information that keeps on coming from various sources. One was on the lockdown, when the lockdowns will be lifted, how many actually cases are there, what is the severity of the COVID, how many districts are opening up. We have actually come out with three models. The base model is there, we were assuming that if 17th the lockdown will go away, then when we can start business as usual. It's all based on algorithms that we have actually built and we have written. Point of time. Every department is following that. One is that I can resume the business. We are talking about business as usual. When the business as usual will start is what we are building in.
These are important things from our perspective of ensuring whether how quickly we can resume and how quickly. This is equally important from the cost point of view, that how many people would I need, especially the NFP. How quickly can I deploy the people? All these things are built into this to come out with everything. On the ALM, I think Nalin will reply to you, but I can tell you one thing, that the ALM is based on the policies and all the mismatches that are there that is within the boundary that is to be kept. You can have a monthly, but you at the quarter end, you need to have a, it should be fully matched. All these things that are laid down by the regulators, those are always adhered, and we have never, ever breached them. I think you have done it.
No, my question is-
Nalin, if that's your question, you can reply. Can you go ahead with the question, please? Yeah.
Yeah, my question is actually different. My question was, based on the various scenarios what you have worked out, what do you think is the estimated provisions and estimated credit cost under scenario one, two, and three? That is my first question.
Now that will be a forward-looking statement. We are not giving such information. Internally, the company has worked out various scenarios, and we have prepared our business plan accordingly. Depending on what kind of scenario we face, we will act accordingly. Can't give you any specific number in terms of what is the reserve in situation A, situation B, or situation C.
Okay. I think we have replied to that.
Thank you.
Yes, sir.
The next question is from the line of Shweta Daptardar from Prabhudas Lilladher. Please go ahead.
Yeah. Thank you, sir, for the opportunity. I have a couple of questions. When you mentioned that 8 lakh customer base has opted for moratorium, was there any kind of filtration or any past payment history or any eligibility criteria for credit bureau score taken into consideration, or was it that every proposal that came forth was considered?
There are two things. It is not opt-out, it is opt-in. There are two ops. One is that if you read the circular instruction, RBI circular, it was very clear that it has to be offered to everybody. How we operated was option on the side that you could opt in and say: I want to exercise this opt-in moratorium. The second one was we also gave it within the policy. It was compliant to the Reserve Bank of India, and it clearly says that if you do not pay me in March, April, May, you will automatically be enrolled for the moratorium program. The INR 8 lakh constitutes these two numbers. So, I would you like to what you want to do it, and out of that, almost INR 2 lakh have also repaid it.
They felt it necessary that there is no point continuing with it. This is opt-in, plus people who have not repaid it automatically when the cycle comes and the due date comes.
Okay. Lot has changed in this month of April. What is the net number and value terms as on today in the month of April?
As on today, ma'am, I will not be able to give you. On 31st, yes, there are numbers, and I have given you those numbers of INR 8 lakh.
Sir, one more thing. Just taking cue from the previous question. I understand you're not making forward-looking statements, but what was the thesis or the scenario analysis and the corporates assumed for this INR 490 crore kind of ECL provisioning?
I think, let Aparna respond. Aparna, can you respond to this INR 489 crores? The CRO will say because it was based on the ECL and whatever, you know, the stages in there and all that. She should be in a position to actually respond to it.
Okay. Good evening. Am I audible?
Yes, you are.
Okay. Essentially, what we have done is just like Nalin had mentioned earlier, we have created scenarios, and we have estimated. There are essentially three variables to these scenarios, which is the extent of lockdown. What is going to be the social distancing norm that will exist, for how long it will exist? What will be the period by which the economic recovery will come back? These are the variables that have gone into it. Based on this, we have estimated what our potential losses could be in two, three, four. Actually, we've mentioned three, but we have done a lot more of analysis, and we have come up with what our peak losses could be as per an internal scenario. We have provided in this overlay for our peak losses that could happen.
Like sir had mentioned earlier, the whole idea of making this provision is I should be able to handle any losses that will come over the next 12 months, largely on account of the COVID impact. That is the basic principle behind this 490. Does that answer your question?
Yeah, partially. Would you like to quantify as such to attribute numbers to any of these variables?
Yeah. See, that's again an internal information about how we have come up with. See, what will the lockdown be, that's public information. We have used all public information, and we have made some amount of estimates internally. I won't be able to share with you exactly what is the scenario, because that is more privy to internal, but we've come up with a scenario that we think is representative of what will happen to our business over the next 6-12 months.
Okay. Secondly, coming back to you, talking about receivables. If I look at spend per average card, that has been declining quarter on quarter. The Q4 number has been down. We had seen only loss of 10 business days as far as Q4 quarter is concerned. Going forward, even you have admitted the fact that the economic activities and the business per se is going to be pretty stagnant. Just another variable which you mentioned, that there will be lot of small value transactions that will be going up, but discretionary-led high value transactions are definitely going to come down. These both points put together, how do you see the receivables and spend panning out in next first half of this year?
Hi, this is Girish. I'll answer your question in two parts. The first question that you asked around the spends part of it. If you go through the presentation on slide nine, it was very clear that the FY 2019 spends per card was around close to INR 142,000, and FY 2020 is INR 139,000. The difference is only INR 3,000. This is after we have added a very large number of new accounts into the portfolio. Okay. If you look at the number of new customers which has been added and digested and those customers maturity grids or graphs, and still the spend per se is at INR 3,000 less. If, let's say COVID-19 was 15 days later, we would have seen maybe a marginal growth in these numbers.
In fact, on the retail spend per card, we were seeing a growth till February end, and it is in the month of March that we saw a bit of a decline because of this reason. However, and this is after the large number of new cards which has come into the denominator for this year. Okay? The second part that you asked on the receivables. Receivables is made of three components. There is a component which is a term balance, which is EMI-based balance, where some people have taken moratorium, as you are aware, and those balances will be payable from the month of June onwards if the moratorium does not get extended. That balance has continued to go up. The second part of this overall receivables is the revolver balances.
These are the balances where people who pay at least the minimum amount due, which is the 5%, and then continue, but have not paid in full, and they revolve for, let's say, whatever period that they are comfortable with. Those balances are also constant. The third part of the balance, which is the transactor balance. It is there where we have had an impact in the month of March also. The reason being that people were unable to spend. People who were transactors were unable to spend in the month of March, at least in the last eight to ten days. The online had stopped to take orders.
There was some spurt in the essential commodities, which was non-discretionary item, but travel, railways, everything, those things, as our MD, sir, mentioned, had come to quite a halt. This is how the movement of receivables is. The total sum will be a mix of these three movements.
Okay. I apologize, I'm harping on the same thing again. Again, because of lack of any discretionary spend going forward, at least for next two months, and very minuscule incremental expansion in number of cards, also corporate spends coming down. How do you see this spend per average card moving going forward? Because that will also have direct bearing further on your receivables. In the first place, how do you see this spend number would look like?
As was said by Nalin, we will not be able to give you any forward-looking scenario. However, I can give you some indicators. SBI Card caters to mass and mass affluent customers. Even as a mix of these customer profiles, a large part of their present spend is also non-discretionary. The categories like departmental stores, grocery, utility bill payment, fuel, insurance, all those categories are continuing. There are, however, some movements because, for example, things like utility bills, all the departmental store and grocery things have now majorly become online rather than offline POS. We still have lockdown in continuation. After 17th, as was being mentioned, it will take some time for some of these things to stabilize to be able to come to the rightful conclusion.
In the same period, there have been a lot of competition flaring up, especially now, be it Amazon Pay or many others who have been vying to pick up this particular pie. How do you think , because everybody is looking for such grocery or online and utility kind of payments pie. What's your thought process there?
Ma'am, at this point of time, we are in touch with almost all merchants. At this point of time, the issues are larger. The issue is that for these guys to be able to deliver, to keep their employees safe. Most of the companies at this point of time are trying to, yes, competition is important, but at this point of time, delivery to the customers is more critical. There are some offers that we are also running, other people will also run offers, and those offers will continue to do. Until this point of time, as you have seen in the data, we have been gaining market share year-over-year. The way that we are positioned on online as well as our relationship and the focus, we believe that that will continue to happen.
Merchants and network partners are very much there. They would continue the tie-ups as well as the NDR and those things will stay, right? That's a positivity that is coming already, right, from their side?
Yes.
Okay. Just last question. You just mentioned, we focus on mass affluent customer base. Do you have, say, any cap on the credit bureau score below which you would not like to dilute? Something on those lines. Would you like to quantify that?
Credit bureau score is at any given point of time. When we do a risk scoring, we actually factor that is one of the component that comes in. I mentioned to you, we use another product which is called a CreditVision, which gives the trending information about you. Then you have this application score that comes in, where you are working, what you do, what's your average salary, lot of stuff that goes into that. Thirdly, it is a deep tube score that we look at our own portfolio, and then you arrive at it. Obviously, one would be careful not to do it, but it's not always that you will not do anybody.
Sometimes a customer can move towards a secured category and he says: I need a card. Risk scoring is a combination of lot of elements, and the risk model is extremely proprietary for any organization.
Okay, sir. Okay. That's all from my side. Thank you.
Thank you very much. Before we take the next question, we'd like to inform participants that in order that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. Should you have a follow-up question, we request you to rejoin the queue.
One of the reasons that we like to mention it over here, 7:00 A.M. to 7:00 P.M. is the curfew, and many of us have to return also. That's why we have kept it up to 6:00 P.M.. People will take almost an hour to reach back, or in case there are some drivers who have to again go back. We would like to actually keep it up to 6:00 P.M.
Absolutely. Yes, sir. We move to the next question. The next question is from the line of [Parag] from White Oak Capital. Please go ahead.
Sir, thank you. My question is, you said around 8.4 lakh customers have opted for moratorium. If possible, if you can quantify the amount, that's first. Secondly, among the people who have taken moratorium, is it possible to give some sector kind of a color that how much of them are salaried, self-employed, or within which sectors? Probably if you can highlight on the sector part, that would be helpful. Thank you.
I think Aparna will take you through. Aparna, you can take through on this.
Sure, sir. Can you hear me, Parag?
Yes.
You're loud and clear. Go ahead.
In terms of moratorium, I think like we mentioned, we did look at the data by salary, self-employed, category of company. There's a fairly equal distribution. It is not like only the worser customers went out and took the moratorium. In fact, I think like Mr. Prasad had mentioned in his presentation earlier, we actually also looked at it from a credit perspective. A large majority of customers who had taken moratoriums actually had a very good clean credit history in the preceding 24 months. In terms of numbers, there are no real trends about whether any particular geography has taken a higher take-up rate of the moratorium or any particular segment. It's been fairly equitable across all, whether it was geography, whether it was the kind of customer.
In fact, like I mentioned, the quality of customers who've taken the moratorium actually is better compared to the overall portfolio. If I were to rank them by distribution, the moratorium customer distribution is actually better.
Okay. In terms of amount, ma'am?
We put the amount as about close to INR 3,800 crore is the balance of that 8.2 lakh customers.
Sorry, I missed the amount.
As of March, we had mentioned that it is about 8.2 lakhs of customers who have taken moratorium. The balance of those customers is about INR 3,800 odd crores.
Okay. Thank you very much, ma'am.
Thank you. The next question is from the line of Kaushal Kedia from [Wallfort PMS] . Please go ahead.
Yeah, hi. Can you give some breakup on the customer profile as to how much percentage is salaried and self-employed? In the DRHP, you had mentioned 87%. Is it still the same, or has there been some change in that?
I think the mix remains almost the same. Three months would not change a portfolio with a large of 10 million customers that we are at about 85% salaried.
Okay. Can you please give some light on what exactly are corporate spends? . 25% of your spends come from corporates. What exactly is that? You mentioned that you want to discourage them from spending on inventory. What is spending on inventory with credit cards?
We are actually, obviously we would respond to the risks that are sitting over there. We are converting some of them into T&E. In fact, actually, I think all of them have been converted into T&E. We are very mindful of this fact. We have gone back and all our customers, they have understood that there is a risk sitting over there, and then they would like that they are fine with ensuring that it is not done through the credit card, and they would use the bank lines and other things. As such, the demand is also not there much. Their manufacturing activity has come to a grinding halt and all that stuff. Presently, we have converted all of them into T&E.
Thank you.
T&E is Travel and Entertainment, sir.
Which is basically given to the employees who can use it for whatever purposes other than for personal use purposes. Manish, would you like to throw some light on the corporate card?
Yeah. Sir, I can do that. Okay. I think there were two questions on corporate cards, and I hope I'm clear. See, typically what happens is in T&E cards, the cards are carrying smaller limits individually, but a larger number of cards go to a corporate. Yes, at this point of time, the travel and entertainment usage will be less, but as it comes back, that usage picks up. Wherever we hold a security, a solid security from a corporate, like a fixed deposit or a bank guarantee, and it's a secured exposure, we give a little bit more flexibility to the corporate to use the card so that the market opportunity can be also tapped to some extent in the business.
When that comes to unsecured exposure in the present times and the way the things happen in this coming period, we have de-risked the portfolio by restricting the usage to T&E, which is by the individual employees. You always balance out the spend versus the risk that you take in a corporate card portfolio. We have grown these spends, and even in this environment, we'll find out opportunities to grow these spends, but at the same time, we want to keep the risk very low in our corporate card portfolio. I hope that answers the question and throws some light on it..
Thank you. Before we take the next question, a reminder to participants to please limit your questions to two per participant. The next question is from the line of Ashish Sharma from Enam Asset Management. Please go ahead.
Yeah. Thanks for the opportunity, sir. Congratulations on a good set of numbers in a tough macro environment. Just on the spends part, sir, could you give a split of spends between retail and corporate? Should we assume the ratio, the mix remains same vis-à-vis FY 2020? That would be my first question. Second would be in terms of if you have to split the spends in terms of contribution in the first half and in the second half, usually what is the split like? That would be the two questions.
The spends on the retail and corporate mix has changed. It has got more in the favor of retail. Corporate because this year the corporate, as sir was mentioning in his opening address, retail has grown by close to 39%, while overall we have grown at the rate of around 27%. The retail portion of the overall spend has increased. On the mix that you are asking on the first half to the second half. On a normal year basis, this year we don't know because the pandemic is there in the first half of it, but otherwise on a normal year basis, typically the spends are 45/55 or in that ratio.
Thank you. The next question is from the line of Swechha Jain from ANSA Wealth. Please go ahead.
Hi, sir. First of all, I would like to congratulate the whole team of having such a spectacular performance in spite of the COVID-19. Sir, I have two related questions with respect to the impact of COVID-19, which we are facing at an overall level. First question is the INR 417 crore impact that we have mentioned. I wanted to understand that impact. Can we assume that this is just the last 10 days impact that we have faced in our profits?
No, it's not. We haven't taken the impact last 10 days. This is a reserve that we have created for future impairments that may come in the next 6 to 12 months. That's what the CRO had mentioned earlier.
Okay. Thanks, sir. Sir, a related question to this. We have seen an increase in the credit cost. Do we expect the credit cost also to be at such high levels for next couple of quarters?
If you look at it, the credit cost right now has gone up because of the provision charge that we have taken extra. That is what has impacted the credit cost. Depending on how the situation pans out in the future, if our reserves are adequate, then I would say that the credit cost will not be at this level. It will come out because right now it's impacted due to the high reserve that we have booked in the March numbers.
Thank you. The next question is from the line of [Jitesh Saraf] from SBI Securities. Please go ahead. [Jitesh Saraf] from SBI Securities. Please go ahead with your question. There seems to be no response from the line of [Jitesh Saraf]. We'll move to the next question. Next question is from Nishant Shah from Macquarie. Please go ahead.
Yeah. Hi, sir. Couple of questions. Could you talk about just backward-looking what is the kind of card customer mix that you have? Say within the salary segment what would be the employee categories? Say a Cat A or a Cat B employee versus say an SME or a startup kind of employee. That kind of mix if you can give. Similarly, within the self-employed segment, what proportion? Would it be more than 50% within the self-employed that are self-employed professionals? That's the first question. If you could give some bit of backward-looking color on the customer mix.
Aparna, could you just respond?
Yeah, sir. We've not put those numbers out there. I'm just going to give you, Nishant, some approximate numbers. Like we've been mentioning, our salaried portfolio is about 85% of our portfolio comes from salaried, and within that more than I would say 60%, 65% of that is actually a Cat A and a Cat B kind of companies. When I say Cat B, Cat B essentially represents government. A significant majority, almost 60% out of that 85% would actually be coming from the Cat A and Cat B, and the balance are of course the Cat C and some other retired and pensioners, which is a very small proportion. That's where it comes from. In terms of self-employed, see this is information that's collected on the application form. To that extent it's not really verifiable in that sense.
Even there we are about 60%, which would be stating themselves as professional, and the balance 40% would be businessmen. What exact business is not something that's accurately available, so I wouldn't want to put that out there, but that's the overall landscape.
Sure. Just one clarity here. When you say 60% of salaries you mean 60% of 85% or 60% of the total?
Let me put it as a total. Out of 100, 15 are self-employed. About 24 would be Cat A. Okay. About 31, 32 would be Cat B, and the balance are Cat C.
Okay, perfect. Yeah, that's very good. Second question is more on this moratorium side. Among these customers could you clarify whether largely the moratorium availed is on revolver loans or largely on EMI loans? How exactly is the split over here?
Okay. Nalin, do you want to take that or do you want me to take that?
Go ahead, Aparna.
Nishant, on a card due there's really no difference. It's not like there's an EMI loan and a card loan. Okay?
At a customer level.
Mm-hmm.
As opposed to if I am a customer who has a retail spend as well as an EMI, then every single month, the due that I am charged and billed for is essentially 5% of my retail balance and the EMI that's payable in that month. If you take moratorium, you take moratorium for both. It's not EMI different from transactor or the revolver balance. Does that answer your question?
Not entirely. Basically, I was just wondering. We would know what the split is for this entire INR 3,800 crores. What proportion pertains more towards EMI and what proportion pertains more towards a transactor or a revolver? Correct. Could you probably split that out?
I don't think we've put that split out there. Right now the 3,800, like I said, is across those customers, and I think the split is not different. Whatever was there earlier in terms of our asset split, that split is still not very different. I don't think we should break up this 3,800 between EMI and retail and all that because it doesn't really make a difference to how you're going to look at that customer. Like I said, the customer is on moratorium, and he's taken the moratorium for his entire balance
Thank you. Due to time constraints, we'll be able to take one last question. We'll take the last question from the line of Dhaval Gada from DSP Investment Managers. Please go ahead.
Thanks, and thank you for the detailed disclosures and presentation. I had two questions. First one was for Nalin. What was the acquisition cost per card in FY 2020? The second was for Aparna. You mentioned that you've taken peak delinquency to determine the provision number, and earlier in the call, I think someone mentioned that 35% is the recovery rate. If I gross up that, is that the peak delinquency that came out in your stress scenario? Just trying to confirm these two. One more thing was on the collection capacity. What's the kind of increase that we've done now versus pre-COVID-19? Some quantitative numbers around collection capacity. Thanks.
Manish, you can go ahead with the cost of acquisition question.
Yeah. I think previously also when the RHP was there, we had given a sort of indicative number that they stay in the market range. To give you a very rough approximate range from a past data standpoint, depending upon quarter-to-quarter movement of business because typically a quarter, last quarter normally we do well. Had COVID not been there, we would have added some more cards. In that case, somewhere approximately INR 3,000-INR 3,500 cost of acquisition in terms of the sales cost or the channel cost is approximately in that number. I can give an indication of where it generally stands which comprises our manpower cost, our incentive for people, the rentals that we pay for various things. That also includes the variable payouts, some of the payouts that we carry out.
A ballpark benchmark number stays in that particular reference range, fairly consistent across the whole quarters of this year, moving around that particular range.
For the year, it was still in the INR 3,000-INR 3,500 range?
Yeah. I'm saying approximately in that range. I can give you a range. It keeps on varying depending on circumstances of a particular month. I can give you an approximate range for the number.
Sure. Okay.
On the other question?
Aparna, you can answer the other one.
Okay. I'm just going to take, at the risk of a little bit of a repetition, Dhaval, I'm just going back to what the logic for arriving at the reserve card and the answer to your recovery question is actually different. Okay. The question earlier was what is the kind of recoveries we make out of accounts that get written off, and to that, Nalin had replied that 30% of what we write off normally comes back in three years. Okay. That's a separate piece of information. What is the logic that we use to arrive at the COVID overlay provision that you're seeing here is, like I'd mentioned earlier, we did scenarios using a number of macroeconomic variables and variables specifically related to COVID.
Things like how long will the lockdown be, how long will the social distancing be, what is going to be the kind of recovery period, when will economic recovery or activity be back to where it was prior to the COVID. Then we estimated the impact of each of these on our activities, on whether my collection capability, on how the spend will move, how the balance will move. We estimated the impact of each of these individual variables, and then we looked at what would be my peak losses over the next 12 months. Okay. Obviously, this is to some extent an estimate. The principle behind the overlay provision was, I want to reserve today as a business to save myself for any future losses that would arise out of the book that I have today. Okay.
It is just an estimate of future losses basis these macroeconomic variables. Does this take into account some amount of recovery? Obviously, it does. If I'm going to estimate losses in the same period, I've actually estimated how much of those losses will I be able to recover within the same 12-month period or not. I have not considered either losses or recoveries beyond the next 12 months. Does that answer the question?
Understood. Just one follow-up to that. What's the most critical variable in your sensitivity model?
The model wouldn't really be a robust model if I had any one variable which was having a higher weightage. The weightage is we looked at almost 8-10 variables, and it's not like any one variable was the most significant one.
Understood. Just the last one on collection capacity, where we are today versus pre-COVID. Thanks.
I think, Richhpal would you like to take this question?
Oh, yes.
Anu would like to. You can take this question?
Yeah.
Okay.
I can do that.
The chief operating officer is going to take that question, Mr. Richhpal. I just want to tell you one thing, that this provision that you look at it, and there are various things that all of you have been talking about it. I think it's very discretionary, and it's a prudent, proactive measure that the company has taken. Please look at it from that perspective, that whether the company was strong enough, it is capable enough to come out with these provisions and to see to it that the profit also remains very strong. These provisions, don't consider it as actually all that risk sitting in the organization. It's not a risk if everything is sitting in the organization. It's a prudent step that we have taken. It's a proactive measure that we have taken to see to it that the provisions are there in case something happens.
Nobody knows how severe the COVID-19 impact is going to be. We could have just gone ahead and said that, this is what is the provision. The regulator is saying please only provide 10% of the provision for these accounts where moratorium and other things have been given. We could have very easily gone ahead and done that and come out with a small provision, and we could have shown a good result. The point is, I think it is to be understood that the company felt that it is important, prudent, and a good management practice to provide for these provisions and to ensure that in case there could be a risk that may come up at some stage, you have taken care of it.
What it will also do is, in this future year, next year, assuming that it is fully utilized, at least this year's loss will not be actually consumed by the profit that is going to come up. I think that this is what is very important from our perspective. We are on Ind AS, as I mentioned to you at the beginning. We are on Ind AS. As such, we hold high provisions because of the accounting norms that we have, and that is what we would like to continue to actually be looked at. If you look at it from that prism, you would find that it is an absolutely forward-looking statement that this company has gone ahead and made this provision. Simultaneously, the profits are even better than December numbers that we have. I think Richhpal, if you could—
I'll just give you an overview of our collection capabilities.
If you quantify, that would be great. Yeah, thanks.
Okay. I'll just give you an overview. Our collection, basically, workforce comprises of three components. One is our permanent employees, permanent resources. We have basically about over 700 employees who are permanent employees of SBI Card. We have telecalling centers. These are vendor resources, basically vendors who have been onboarded for telecalling. That is, calling customers for collections, collection activity, as well as for recoveries. We also have agencies, and these agencies, vendor agencies, are located across the length and breadth of this country. We have almost close to 300 agencies which are on our roll. These telecallers, as well as the field resources of agencies, are in the range of around 6,000- 6,500, and they keep varying and they keep changing from month to month as and when we keep onboarding vendors as and when we require.
Now, as it was shared with you during the presentation also, due to COVID, our field activity has come to a complete halt in the initial phases. What we have done, we have enabled all our permanent staff, even while they were not telecallers, all across the bands and across the seniorities. All our permanent staff have been enabled for telecalling from home. As well as the telecalling centers, which also, again, because of the restrictions on movement, physical movement, these telecalling centers of vendors had also got shut. We have used dialer solutions, cloud dialer solutions. We also have used our CRM platform that we call Collections24 for enabling the entire telecalling workforce of these vendors to call from home. Additionally, these agencies also have telecalling staff.
Those telecalling staff, as well as some of the field staff of the agencies, have also been enabled to call from home. Because these are the times when some of the activities are slow, we have also roped in cross-functional resources for calling activities. This is what we will continue to evaluate as and when we need more people. There is bandwidth available within the company, and then there's a flexibility of onboarding more people. As we speak, let me tell you, like sir had mentioned earlier, we are looking at activities zone-wise. In the green zones in this country, of the 280 odd or close to 300 agencies, 80 agencies have already opened shop, so physical activity also partially has been restored.
Okay. I think that should bring us to an end of this investors call. I just want to reassure everyone sitting over there that the company has solid business model. It has a very strategic outlook in terms of what it does. Obviously, the provision that is there should not be mistaken as if there is a problem sitting in the organization. It's more of a proactive measure taken by the company to ensure that in case there are anything that could actually, we have taken care of it. We could have very easily, I think most of the banks or other competitors would have gone ahead and done those bare minimum that is required. We felt that it was important for us to actually come out in a more prudent way, especially when the ECL could have been pretty low.
I want to assure you that the digital push, the co-brand relationship that we have, the banca relationship that we have, the risk modeling that we do, the new generation modeling that we do, the machine learning and the bots that we have in the risk department, the data that feeds the spends, all these put together are very strong in terms of what we are doing. The risk department has come out working very hard to come out with a model which should actually take care of the prudence that we have done it. Please be assured that there is no such big risk sitting over there in the organization. Thank you very much. I'd like to thank everyone to be there. Thank you very much.
Thank you very much. On behalf of SBI Cards and Payment Services Limited, that concludes this conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your line.