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Jio Financial Services, the non-banking financial company (NBFC) of Reliance Industries Limited (RIL), announced its third quarter results for the financial year 2024 on January 15. The company has announced a net profit of Rs 1,344 crore, which is a hike of a whopping 101 percent from the previous quarter's Rs 668 crore. A comparable growth of about 47 percent was evident in the total revenue from operations rising to Rs 1,216 crore from Rs 608 crore recorded during the second quarter.
The company reported impressive earning performance as the present core segments consumer finance, digital payments and wealth management all showed strong. Besides, the company tapped synergies with its own parent company RIL that has been ranked as India's largest private sector company and Indian energy and materials conglomerate Reliance Group leader.
Consumer Finance: A Core Growth Driver
Jio Financial Services tenders to its customers a wide array of consumer finance products that seek to include personal loans, home loans, vehicle loans, and education loans among other products. Through the use of its digital platform JioMoney, it offers to continue convenience, accelerated approval, and equitable rates revolving around every financial product to its customer base. The company also prides on a strong distribution network with over 10,000 outlets across the country.
Third-quarter performance was boosted by a rebound in credit demand as interest dried up meaningfully amid culled COVID-19 lockdown. Loans extended by the company rose 50 percent sequentially to Rs 4,500 crore in the quarter under review. The loan book also witnessed a 45 percent growth on a year-on-year basis to Rs 15,000 crore with a healthy asset quality. The gross non-performing assets (NPAs) ratio stood at 1.2 percent, while the net NPAs ratio was 0.4 percent.
The company also launched the new products and services in the quarter among them Jio Home Loan offering prospective home loans for 6.5 percent interest rate the lowest in the industry. Additionally, the company networked through partnerships with premium e-commerce platforms such as Amazon, Flipkart, and Myntra, to provide instant credit to online shoppers.
Digital Payments: Towards a Cashless Society
Jio Financial Services has, in fact, been a front-runner in the digital payments space with its flagship offering, JioMoney, which has over 100 million users. The app helps make payments, transfer money, recharge, pay bills, and shop online using the mobile phone. It also offers various forms of rewards in the app and cashback too.
The digital payment segment saw increases in transaction volumes and value during the third quarter as more people turned to cashless modes of transactions, capitalising on various benefits associated with the same amid pandemic times. It processed over 500 million transactions for the quarter, which was up by 60 % over the last quarter. The transaction value also increased by 55 percent to Rs 25,000 crore.
The network of merchants has also grown, and currently, there are over 5 million merchants who accept JioMoney as a form of payment. Additionally, the company has partnered with various platforms like JioMart, JioSaavn, JioCinema, and JioTV to link the app, making it comfortable and convenient for customers to make payments.
Wealth Management: A New Frontier
In the third quarter, Jio Financial Services also forayed in to the wealth management segment with Jio Wealth which is a digital platform offering investment advisory and portfolio management services to its customers. The platform makes use of artificial intelligence and machine learning in order to provide personalized as well as customized investment solutions for its customers, in accordance with their risk profile, goals, as well as preferences.
The platform provides multiple investment products that include mutual funds, equities, bonds, gold as well as insurances. Goal-based planning, auto-rebalancing, tax optimization, and performance tracking are the other unique features available in the platform.
The wealth management segment saw a good response from the customers in the quarter with more than 1 million users registering to the platform. The platform also managed around Rs 2,000-crore assets in the quarter with an average return of 15 percent.
Outlook: Road Of Growth Ahead Looks Bright
Jio Financial Services has emerged as among the leading players in Indian's financial services space, with diversified and innovative offerings. Further, the company had leveraged with the parent company RIL's strength with digital infrastructure, strong customer base, and brand value to bring a competitive edge in the market.
The company is expected to sustain the growth momentum with an aim to launch Jio Insurance, Jio Mutual Fund and Jio Credit Score in the future quarters. The company focuses on the increase in the customer base, market share, and profitability through concentration on customer satisfaction, operational efficiency, technological innovation.
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Echoing firmness of the company's confidence, RIL Chairman and Managing Director Mukesh Ambani, who is also Asia's richest person. He further added, "Jio Financial Services is a key pillar of our vision to create a digital society in India, where every Indian has access to affordable and quality financial products and services. We are delighted with the strong performance of the company in the third quarter and we are confident that the company will continue to create value for its customers, shareholders and the nation." –(Greatidea360)
