PMC Fincorp Limited to launch new product, Loan Against Securities

PMC Fincorp Limited, will be launching a new financial services product. Given the focus on capital markets and its participants, the company realized the opportunity for a product that allows investors to monetize their investments without selling them. Loan Against Securities (LAS) is a unique product for the borrower and the lender. For the borrower, it allows monetization of one's investments without the requirement of liquidation and for the lender, it provides liquid securities against the loan provided. This facility can be accessed by individuals, body corporates etc. for various personal and business purposes for short to medium term.

The intention to launch this product is to capitalize on the opportunity arising out of India's capital market participation in recent years. Based on data, it is evident that India's retail investors have become a dominant force having accounted for 45 per cent of the turnover of National Stock Exchange in FY 2020-21. Domination of traditional investments by retail investors in real estate and gold till now introduced us to products such loan against property and gold loans. However, this movement of money from gold, and real estate to stocks and mutual funds will create demand for loan against securities. As a key intermediary in India's economy, the company is launching this product with a vision to enable the retail investor's shift to financial assets, which is critical for India's growth.

In the first phase of this launch, the company has pre-approved Nifty 100 companies, and are open to examining any other request for loan against shares outside the Nifty 100 universe. As the company's operations and client acquisition strengthens, it will expand the pre-approved list of securities to expand beyond Nifty 100 and include mutual funds, bonds, insurance policies etc. in a staged manner. The company also realizes that digitalization is an important aspect of business in today's economy. In view of the same, the process will be digitized step by step as this new business grows within the company to reduce the processing time.

For the past few months, the company has been developing the standard operating procedure and putting all the legal structures in place for a robust foundation that will allow it to fully exploit the market opportunity for this product. In view of the same, the board of directors have adopted the necessary policies and procedures for the company to start offering this product.

Shares of PMC Fincorp Limited was last trading in BSE at Rs. 2.02 as compared to the previous close of Rs. 2.00. The total number of shares traded during the day was 319584 in over 567 trades.

The stock hit an intraday high of Rs. 2.10 and intraday low of 1.99. The net turnover during the day was Rs. 649948.00.

Source : Equity Bulls

Keywords

PMCFincorp INE793G01035 ProductLaunch LoanAgainstSecurities