With increase in FDI flows, ICICI Bank ups focus on MNCs

With the increase in foreign direct investment into the country, ICICI Bank on Tuesday said it is upping its focus on serving the multinational companies (MNCs). The second-largest private sector lender is looking at services beyond credit needs of such overseas corporates with an eye on the fee income possibilities, its executive director Vishakha Mulye told reporters.

It already serves about 1,500 MNCs out of an overall market of up to 5,000 companies, she said. Mulye said factors like aversion to China, favourable demographics and an improvement in the overall ease of doing business is leading many companies to look at investing in India, leading to an increase in foreign direct investment (FDI).

FDI flows were at USD 30 billion in the first half of the year despite the pandemic, as against the USD 43 billion last year, she said. The bank, which has been witnessing a robust growth in its MNCs business, on Tuesday announced a dedicated offering for the segment to further accelerate on the segment, Mulye said.

The ’Infinite India’ service is an online platform aimed at foreign companies looking to set up shop in India and offers services like facilitating incorporation and corporate filings, Mulye said, stating that operating in India is complex for an overseas company. The bank will also get access to the dealer and vendor ecosystem of the company through such a relationship, she said, stressing that it is not credit needs alone which it is targeting to serve.

She said this also blends well with its overall strategy of sticking to the India-centric business from abroad. When asked about the recent changes on the current account front and how it will affect such an initiative, Mulye said it will not impact because the credit needs of such new to India MNCs are very limited as they are sufficiently capitalised.

The bank has devoted a dedicated team of professionals, which includes both shifting in-house resources and also hiring new employees with established relationships to help in the MNCs vertical, she said. Extending services like acting as an authorised dealer for both inward and outward remittances, payments and collections services can also help it garner fees, she said.

The bank was the first to launch offshore non-deliverable forwards contracts on the rupee after the RBI allowed the IFSC units to dabble in it, Mulye said, adding that it commands an over 30 percent share of the market at present.