Life care financing launched by Bajaj Finance for elective medical procedures such as stem cell storage, eye care, dental treatment, IVF, maternity treatment and cosmetic-based hair and skin treatment is all set to clock a revenue of Rs. 120 crore by the end of this financial year.
Uncovered by health insurance companies, more than a dozen elective medical treatments have been financed by Bajaj Finance since last eight months. Approximately 14,500 people have availed financing from the company for elective medical procedures, top categories being stem-cell (40 per cent), dental care (22 per cent), hair & cosmetic treatment (12 per cent), eye care (8 per cent) and others (18 per cent).
Talking about Bajaj Finance entry into life care finance, Devang Mody- president, consumer business, Bajaj Finance Ltd, said “In medical procedures (especially elective procedures), we have witnessed a pattern in which most consumers aspire to avail premium services but due to budget constraints and non-availability of an easy finance option or insurance coverage, they settle for basic services. In a bid to tap into this untouched market, we have ventured into life care lending.”
“Presently, the healthcare market size in India is estimated at Rs. 5,000 crore and is expected to grow by 18 per cent per Y-O-Y. At Bajaj Finance Ltd. we’ve begun life care finance 8 months ago and it’s still in its nascent stage. We have been witnessing a surge in the number of cases every month and are targeting a revenue of Rs. 120 crore by the end of this financial year. Over last over 4 months we have disbursed loans worth over Rs. 18 crore. Further, with the innovative products, we would be targeting a loan disbursement of Rs. 1,000 crore by the end of 5 years,” said Mody.
With presence in 39 cities across India including metros and tier I cities, the company offers easy EMIs on elective medical procedures like hair restoration, knee replacement surgery, all knee care related procedures, IVF, maternity care treatment, eye care treatment- Lasik, eye cataract, ICL and retina surgery, dental care treatments, bariatric surgery and selective laparoscopic procedures. Over next 3 months, Bajaj Finance will add 6 more cities thereby expanding its geographic presence to tier 2 locations.
Talking about the future of life-care financing in India, Mody said “We hope with elective procedures reaching tier 2 cities, consolidation in the market coupled with our innovative products for our partners, we will be able to finance at least 25 per cent of the market over the next 3-5 years.”
“More and more customers today are wanting to opt for these procedures and we have the role of enhancing their need and meet aspirations by paying in EMIs. Hence, we need to tie up with the partners to service their needs,” he said.
So far the company has over 15 active relationships that include Mydentist, Richfeel, DHI, Vibes, Enhance, Centre for Sight, Partha Dental, EyeQ, Axiss Dental, Denty's, Vasan Dental, Cloudnine, My Family Dentist Delhi, Manipal Ankur, Venu Eye New Delhi, Spectra Eye New Delhi and Dr Agarwal's Eye care Hospital. It is looking to tie-up with more partners with a national and regional presence.
Bajaj Finance Limited has a customer base of over 6 million. Life care finance is offered to its existing as well as new customers. As per basis data obtained from the last 3 months, we have observed 70:30 customer ratio, which means 70 per cent new customers have been acquired versus 30 per cent existing customers availing the facility, he concluded.