Kotak Group Strengthens Auto Loan Industry and Acquires VW Finance Loan Portfolio in India

In indicating the changing market dynamics in India, the Kotak Mahindra Group has acquired the vehicle finance loan portfolio of Volkswagen Finance Pvt Ltd (VWFPL), the Indian captive finance arm of the Volkswagen Group.

While Kotak Mahindra Prime (Kotak Prime) will acquire the passenger car and two-wheeler portfolio, Kotak Mahindra Bank Ltd (KMBL) will acquire the commercial vehicle portfolio from VWFPL.

With this acquisition, Kotak will have access to over 30,000 high quality customers with a total outstanding loan with VWFPL of approximately Rs 1,340 crore. All of these acquired loans are classified as “standard loans” under current Reserve Bank of India (RBI) guidelines. In addition to these loans, Kotak also acquired VWFPL’s portfolio of non-performing assets.

Commenting on the acquisition, Dr. Kannan, Group Chairman – Commercial Banking, Kotak Mahindra Bank and Director of Kotak Mahindra Prime, said, “The strategic intention behind this acquisition is to further strengthen Kotak’s vehicle finance loan portfolio. and expand our market share. has been operating in the country since 2009 and has built a strong client portfolio during this time. The long-term growth prospects for the Indian automotive market are very attractive and this acquisition strengthens Kotak’s position as one of the leading players in automotive finance.

“I would also like to take this opportunity to welcome Volkswagen customers to the Kotak Group and assure them that they will experience a smooth transition and an improved customer experience with access to a wide range of products, supported by exceptional service standards, ”Kannan added. .

Speaking on the development, Aashish Deshpande, MD and CEO of Volkswagen Finance Pvt Ltd said: “The sale of our retail portfolio aligns with our new strategic direction towards a refined digital strategy through our subsidiary, the KUWY digital platform. It is a step towards the evolution of the customer journey in the digital space by offering a simplified and agile solution to both our customers and our dealers, while aligning effectively to support the VW India 2.0 strategy.