"The mission of HDFC Credila is to transform lives and contribute towards nation building", said Ajay Bohora, Co-founder, MD & CEO of HDFC Credila
The era we are living in may be well described as 'the golden age' of entrepreneurship; the era, where entrepreneurship and innovation form the bedrock of economic development of a nation. The spark for contributing to the welfare of the humanity fuels the desire for entrepreneurship and motivates the new-age entrepreneurs to push forward such ideas and concepts. The world treasures those influential entrepreneurs, who have made a difference in the lives of millions of people introducing ideas filled with brilliance. Holding onto innovation, they have set on a journey with impassioned enthusiasm to change the world around them. Traversing which, they endured moments of darkness but they couldn't be stopped. They learnt their lessons and moved on as they were guided by their passion to succeed. They took giant strides in uncharted territories and endeavored to explore solutions that have never been sought; solutions that have created landmarks impacting society and shaping business landscapes.
While treading on the journey dedicated to pick out the most distinguished corporate leaders, The CEO Magazine came across an opportunity to interview Mr. Ajay Bohora, one of the glorious gems shining in Indian entrepreneurial universe. Ajay Bohora - The man, who revolutionized and pioneered Indian landscape of private Education Loan industry with his brainchild, HDFC Credila Financial Services - the educational loan specialist; the a topnotch entity that has etched its name as the pioneering leader in the panorama of educational loan services. His career took off as an Engineer with Tata Exports Ltd. His dreams of receiving quality education for MBA took him to Hofstra University, New York. However, the path he travelled was full of hurdles. "We couldn't get the educational loans for ourselves even after having good academic credentials in engineering". Both the brothers had to depend upon borrowed money from relatives to pursue their dream education. This concern ignited the passion for entrepreneurship somewhere deep-seated in the corners of the heart. The next six years after MBA observed his career growth at MetLife, New York; his stint here equipped him with profound experience in Finance. Having developed a solid background in this domain, Mr. Bohora along with his brother Anil decided to set his foot in entrepreneurial journey inspired by the desire for contributing to the welfare of his homeland. This resolution led to the launch of a healthcare focused BPO which was incorporated as a joint venture in partnership with USA entity. The brilliance and expertise of Bohora brothers steered the company through rapid growth and pushed forward its entry in the market as an innovative concept. The global BPO giant, WNS Global Services acquired the company and Ajay got to serve on the Board of Directors of WNS Global Services, which at that time was a home to 20,000 employees. This background in compelling leadership gave his career an edge and brought out the thought leader in him. His efforts towards contributing towards the nation building through education envelop higher education. He had co-founded New Era English School in Nasik. The school thrives as one of the 'Top ten Most Innovative Schools in India'. His career portfolio is enriched with several leadership roles he assumes with some of the most revered organizations in India.
These majorly include:
Break of the dawn in Indian Education financing HDFC Credila thrives as the name synonymous with success; echoing the industry best practices and the key values of honesty and reliability. The enormous student community in India has embraced it as the most trusted and an esteemed brand. The powerful leadership steering the dignified efforts of the team has been successful in instilling confidence in more and more people to opt in for an education loan rather than the self-finance option. The company has so far funded more than 41,000 students studying in more than 2500 unique Institutes across 35 different countries.
HDFC Credila's cumulative disbursement figure grabs eyeballs going beyond Rs. 5,800 crores. The company today stands at the forefront of thought leadership towards reinventing this education loan industry with innovation and a dynamic corporate culture. The novel idea behind the inception of HDFC Credila sprung from realizing the lack of specialized and dedicated education financing services provider in India. While attending an event at Florida, Ajay got to know more about the Student Loan segment, which has been the second largest asset class in the USA carrying over $ 1.3 Trillion total student loans outstanding. In India, where education is the key to economic development, total Education Loan portfolio outstanding reached $10 Billion only putting all lenders together. "This unfathomable gap inflamed our desire to venture in this space. We went to a number of authorities, ministry, and credit rating agencies; nobody had any data on this asset class. We did a lot of research for valuable insights. The deeper our commitment got with this project; the more we realized that there needs to be a structured methodical process with an approach to education loan space in India" shares Mr. Bohora speaking about ideation of the company. HDFC Credila traces its humble beginnings in 2006 when the Indian education financing landscape was monopolized by Public sector players. With Indian economy gearing up for a phase of rapid development, there was a dire need to spark growth in this space considering the immense significance education holds in the progress of a nation.
"For majority of the Indian families, quality education becomes the first and sometimes the only priority; it is the purpose of our lives. It needs no mention that applying for education overseas corresponds to knocking on the best opportunities. Given that background, the massive gulf between demand and supply in the education loan has always pervaded the Indian education system as a critical challenge. With the rising cost of higher education, the parents find it extremely difficult to fund the cost of higher education of their children. The requirement of funds has been primarily met by self-funding - 1 iquidating assets like mutual funds, shares, second homes, etc.; loans from friends and relatives; procuring finance in form of personal loans or loan against property and gold, etc. usually at higher rates and without tax benefits. In many cases, the financial situation doesn't support self-funding which eventually results in compromising with the quality of education or prevents from receiving further education. This huge gap could only be filled by specialized education loans", expounds Mr. Bohora informing us about the idea that sparked the journey. Trailblazing the entry of private sector in this space, the company's journey began with the founders' profound mission to transform lives through education and contribute towards nation building. The founders intended to develop insights based on industry data to gauge the scope for development in this space and identify the major gaps that plagued this segment. A huge database was created covering 100,000 courses which was soon followed by the phase of product development and decking out the product with a robust loan processing system. Soon, the search began for investors with an aspiration to become an entity like what HDFC is for Housing Loans. The groundbreaking concept held tremendous potential; that too being unprecedented invoked substantial interest of leading investors and industry domain experts. Credila got the opportunity to draw the initial investment from DSP Merrill Lynch -one of the leaders in global wealth management, capital market and advisory services in India as a minority investor with 40% stake in December 2007. However, Credila's journey witnessed respite for some time as Merrill Lynch was acquired by Bank of America and had to pull out of its principal investment from the lending organizations. The search started all over again and this time Credila proceeded with the offer from Housing Development Finance Corporation Limited (HDFC Ltd.) who acquired Merrill Lynch's 40% stake in December 2009. The event marked the onset of Credila's journey as an esteemed brand. At present, HDFC holds approximately 81.53% of the shareholding and the remaining equity share capital continues to be held by the founders. Besides, HDFC Credila has issued compulsorily convertible preference shares to HDFC Ltd. The company depends on multiple sources for borrowing that typically include Secured Non-Convertible Debentures, Commercial Paper, Perpetual & Subordinated Debt (forming part of Tier I & II Capital), Bank Term Loans, Overdraft facilities, Inter corporate Deposits etc. At present, HDFC Credila secures AAA rating for some of the long term debt and A1+ for short term debt from renowned credit-rating agencies in India.
Mantra for Brand eminence During a conversation with The CEO Magazine, Ajay Bohora - Cofounder & Chief executive officer at HDFC Credila speaks about the success mantra that guides the team,"HDFC Credila gathers a deep understanding of the needs of the students and their parents through the research and engagement programs conducted on a continuous basis. We engage with our target audience, all through their education life-cycle by hand-holding and guiding them and making finance available to the eligible students, while they tread on their journey towards their dream education?"
Following this mantra towards achieving performance excellence has translated into giant leaps that HDFC Credila has taken towards revamping the mode and scale of engagement with the target.
Source: The CEO Magazine