TruCap Finance Ltd (DHANVARSHA) Q4 FY23 Earnings Concall Transcript

TruCap Finance Ltd (NSE : DHANVARSHA) Q4 FY23 Earnings Concall dated May. 24, 2023.

 

Corporate Participants:

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Analysts:

Unidentified Participant — — Analyst

Abhishek Jain — Arihant Capital — Analyst

Anu Sonpal — Valorem Advisors — Analyst

Presentation:

Operator

Ladies and gentlemen, good day, and welcome to the Q4 FY ’23 Conference Call of TruCap Finance Limited. [Operator Instructions] And there will be an opportunity for you to ask questions after the presentation concludes. [Operator Instructions]

I now hand the conference over to Mr. Anuj Sonpal from Valorem Advisors. Thank you, and over to you, Mr. Sonpal.

Anuj Sonpal — Valorem Advisors — Analyst

Thank you. Good afternoon, everyone, and a very warm welcome to you all. My name is Anuj Sonpal from Valorem Advisors. We represent the Investor Relations of TruCap Finance Limited, the erstwhile Dhanvarsha Finvest Limited. On behalf of the Company, I’d like to thank you all for participating in the Company’s earnings call for the fourth quarter and financial year ended 2023.

Before we begin, let me mention a short cautionary statement. Some of the statements made in today’s con call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management’s belief as well as assumptions made by and information currently available to management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today’s earnings call is purely to educate and bring awareness about the Company’s fundamental business and financial quarter under review.

Now, I would like to introduce you to the management participating with us in today’s earnings call and hand it over to them for opening remarks. We have with us firstly Mr. Rohanjeet Juneja, Managing Director and Chief Executive Officer. We also have Mr. Sanjay Kukreja, Chief Financial Officer; Mr. Mahendra Servaiya, Chief of Credit and Risk; Mr. Sumeet Khanna, Digital Credit and Product; Mr. Gaurav Bhargava, Head of Gold and Branch Business.

And now, I hand over the call to Mr. Rohanjeet Juneja for his opening remarks. Thank you, and over to you, sir.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you, Anuj. Welcome to our fiscal ’23 earnings call today. In full year 2023, we reported disbursements of INR10.1 billion, up from INR4.2 billion in fiscal ’22 and INR880 million in fiscal ’21. Robust disbursement growth was driven largely by MSME gold and business loans. We disbursed 94,132 loans in the year, up from 53,420 loans in March 2022, averaging close to 258 loans made per working day.

Total active customer count, which was 5,900 in March 2021 and 33,400 in March 2022, is up to almost 65,000 customers today. Our total loan book at the end of March 2023 was INR5.8 billion, up 90% over the last one year. The product composition of our total on and off balance sheet AUM is almost 61% in gold loans today, 36% in MSME business loans, and 3% in loan against property and personal loans, which are in run-off mode.

We opened 54 branches from April 2022 until May 2023 for a total count of 94 branches that we have today, given our tie-up with five large lenders in lending as a service. These large lenders include, HDFC Bank, DCB Bank, Central Bank of India, Shivalik Small Finance Bank, and U GRO Capital. We are extremely fortunate to have partners with — partnered with these five large lenders to serve the last mile customer, especially in Tier 2, Tier 3 and Tier 4 towns, and are hopeful of substantial value-creation with them over the coming years.

Gross NPAs declined to 2.19% versus 2.73% in the previous quarter, and 3.14% a year-ago. We are pleased to tell you that post the end of the quarter, NPAs have declined further to below 1%, which has come from organic resolution in LAP and personal loans, along with a sell-down of some of the legacy LAP and personal loan accounts.

Now, let us spell-out certain dynamics that played out in the previous fiscal year, and what the Company is doing to mitigate those negative impacts in the current fiscal. Our net interest margin compressed to 7.2% in fiscal ’23, which is lower relative to what we had expected to come between 8% and 8.5% earlier in the year. This compression came from both the assets and liability side, the larger of which impact came from the liability side.

With the RBI having raised rates by 250 basis points since early May 2022, most lenders started passing on rate hikes to us from June and July 2022. Given the increasing proportion of gold loans in the AUM mix today, coupled with the fact that almost 78% of full year disbursements came in the gold loan product, there was margin compression in fiscal ’23.

Happy to tell you that, on the liability side, incremental funding cost has come down in the current quarter. Furthermore, the Company is writing more business with co-lending partners in lending-as-a-service, which gets funded at a fixed hurdle rate to the partner. We are doing this swiftly, the results of which will be evident from the current quarter onwards.

Point two, on operating expenses, which are higher-than-anticipated, largely due to us expediting the experiential center build-out. We were at 37 branches on March 31, 2022, but given the strong traction and tie-ups with these large lenders in lending-as-a-service, we felt the need to ramp-up our experiential center count further and faster. We have 94 of them today, 90 for gold and four for business loans, which is ahead of what we had planned in the previous fiscal.

Many of the branches that we opened in fiscal 2022 have broken even, and the vintage of these branches opened in fiscal ’23, are breaking even faster, giving increasing business being written in lending-as-a-service. Therefore, what we will see in fiscal ’24 is that, while our branch count will continue to increase to cater towards increasing volume for these large lenders, opex as a percentage of AUM will decline in fiscal ’24 and ’25, not just due to denominator effect, but due to several other efficiency and productivity exercises the Company has undertaken.

Now, coming to our longer-term vision on building a large and reputable financial services institution. As an organization, we have disbursed more than INR17.7 billion in loans since our inception to over 1,67,000 borrowers. Of the total INR17.7 billion disbursed, more than 100,000 customers have already paid back and closed loans worth INR10.5 billion, and we have seen two full repayment cycles across both the business and gold loan product. This implies healthy vintage and a proven track record.

In the gold loan vertical, specifically, our team has disbursed more than INR12 billion to over 95,000 borrowers. Gross NPAs in the gold loan book are zero. Gold taken to auctions are just over INR38 million for less than 648 customers, representing 33 basis points of cumulative disbursements. It is noteworthy that we have recovered more than 118% of principal and interest due on gold loans, which were sold in auction, and therefore, we have refunded excess amounts to the borrowers.

As mentioned earlier, we have 90 of these gold branches spread across Maharashtra, Madhya Pradesh, Delhi NCR, Goa, Gujarat, and now Rajasthan. Similarly in business loans, we have disbursed more than INR4.5 billion to over 54,000 borrowers over the last 4.5 years. Gross NPAs in business loans are 1.6%. As an NBFC, we firmly believe our moat or differentiation strategy should be a distribution franchise, which powers our ability to source scalable volume of MSME borrowers. We will do this by collaborating with large lenders for capital. Towards that effort, from August 2021 onwards, we as a company have put in tremendous effort in expanding the distribution footprint in a cluster-based approach in MSME-centric belts, which is spread across 50 cities and towns in semi-urban and rural India.

More than 75% of our branch presence is in Tier 2, Tier 3, and Tier 4 towns, where there is great untapped potential to be encashed, as these towns are surrounded by 30 to 40 villages. That’s where we see the biggest opportunity to serve the underserved and underpenetrated market, which forms the core of our strategy. Along with distribution as our moat, on the capital front, we have made the balance sheet more capital-efficient, by tying-up with large lenders in lending-as-a-service.

Lending-as-a-service is where TruCap leverages its distribution prowess to serve as a minority capital provider, but performs the entire sourcing, servicing, and collections function for the large financial institutions that contribute between 80% to 90% of the loan amount to a borrower. Currently, the Company has five of these lending-as-a-service partners up from one at the same time last year.

Our lending-as-a-service book of INR1.75 billion today is up from INR848 million in September 2022, and just INR76 million a year-ago. On a monthly basis, almost 30% of disbursement volume was being originated in lending-as-a-service from these partnerships, which will soon inch up to 40% to 45% in the next few months.

Further, as we continue to scale up our distribution muscle, we are fairly confident of doing more than INR1 billion in monthly disbursements from June onwards with the lion’s share of capital being provided under these L-a-a-S partnerships. Through this, not only will we make the balance sheet more capital-efficient, but the P&L will also become more profitable and hence accretive to ROA in coming years. In coming months, we are hopeful of giving you more color on traction in lending-as-a-service, and other productivity and efficiency exercises the Company has undertaken to ramp-up earnings growth.

With that, we conclude our prepared remarks, and now open the call up for Q&A.

Questions and Answers:

Operator

Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Krupesh Shah, an individual investor. Please go ahead.

Unidentified Participant — — Analyst

Good evening, sir. Thank you for giving chance to ask questions. So as we have seen a decline in the interest income on quarter-on-quarter basis. So can you throw some light on it?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

The decline in quarter-over-quarter interest income was on two counts, one of it was, there was a sell-down of a certain amount of loans to an ARC. So over there, there is some de-recognition of interest. And number two is, as you have disbursed more and more of gold loans, which is at a lower yield relative to business loans, it has had some impact on interest income. Pleased to tell you that, you should hopefully see that reversing from this quarter onwards.

Unidentified Participant — — Analyst

Okay, thank you, sir. And one more question. So what is the amount of the provisions reversed in this quarter, which helped to increase the PAT via ARC sale transactions?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Yes, the exact quantum of the provision reversals is there — one second. It was about INR1.4 crores.

Unidentified Participant — — Analyst

INR1.4 crores. Okay, yeah. And can you help me out to understand the cost of borrowing currently, as there is an increase in the repo rate, it increased our yield on the product?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

We were not able to increase the yield on our products, because we are more liability sensitive. And given the fact that our borrowers, who are small-medium enterprise businesses essentially, it’s very hard for us or to pass on the hike to the borrower. But however, the lenders passed on the rate hikes to us. So we saw margin compression due to that. The average cost of borrowing for us in all of fiscal ’23 was 13.1%.

Unidentified Participant — — Analyst

Yeah, and sir, this pressure would continue? Or it would be better going ahead?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

No, we expect the pressure to abate. We expect margin compression to — we are probably finally done with the margin compression.

Unidentified Participant — — Analyst

Okay, okay. Thank you so much, sir. Thank you.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you.

Operator

Thank you. [Operator Instructions] The next question is from the line of Dhiren Pahuja, an individual investor. Please go ahead.

Unidentified Participant — — Analyst

Hello. Yeah, thanks for the opportunity. So the gold price have started to increase in last two months. And how has been the trend for LTV for Q4 FY ’23 and in April and May?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So when gold prices go up the way they have, if you look at our disbursement track record over the last three years, we actually slowed down disbursement to some extent, just given the fact that you expose yourself to higher risk when gold prices are going up and you’re lending at about 70% to 71% LTV. So we’re being fairly careful on that front. We’re being very, very watchful on the LTV front as well and also on mark-to-market. Just to give you some color, in the over INR1,200 crores of disbursement that we have done in the gold loan product, only about INR3.8 crores have gone to auction because of our prudence on LTV, number one, and also in terms of the schemes that are offered to the customers. So we do not offer any schemes which offer the customer or the ability to pay principal plus interest at bullet. We only offer principal at bullet. So those are the kind of things that we’ve done to mitigate ourselves from any kind of exogenous shocks on the macro front from gold prices.

Unidentified Participant — — Analyst

Okay, got it. Right. And in Q4 FY ’23, we have seen a good growth in gold loan and the number of branches has also increased. So at what AUM does the branch reach at breakeven?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So usually, the breakeven is about — at about closer to INR3 crores AUM. Obviously, it depends on the geography that the branch is located as well, but rule of thumb is somewhere between INR2.8 crores to INR3 crores of AUM. If you look at where we are on an average AUM basis per branch, I think we are getting much better now. The average AUM per branch on an apples-to-apples basis for all branches that were opened in fiscal ’23 and ’22 was about INR5.4 crores.

Unidentified Participant — — Analyst

Got it, got it. Right. And just one last question, what is the view on the overall gold loan industries and the competition from the bank and the fintechs?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So the market is fairly big. We have chosen a cluster-based approach to where our branches are located. They’re largely in the Hindi speaking belt. Obviously, there is competition, not just from NBFCs, from banks as well, but I think there is enough of a market out there and everyone has a niche. So the banks are in a slightly larger ticket segment relative to most of the NBFCs. We, as an NBFC, while we are very small today, we have a particular niche set of clients that we target, who are small business owners. We are seeing an increasing acceptance as well to take loans against gold, unlike seven, eight years back when that — there was more of a stigma associated with it. So the market is also opening up, the pie is expanding. At the same time, there is competition, but it’s healthy competition. I don’t think you would be in a sector where there is less competition. So it’s both good and bad, but overall, the market is fairly large and we have a niche that we cater to.

Unidentified Participant — — Analyst

Okay, got it, right. Thank you, and all the best.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you.

Operator

Thank you. [Operator Instructions] The next question is from the line of Jill Gada, an individual investor. Please go ahead.

Unidentified Participant — — Analyst

Hello, am I audible?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Yes, we can hear you.

Unidentified Participant — — Analyst

Yeah, okay. So I wanted to ask, can you throw some light on the recent rules given by the RBI on NBFCs and like doing co-lending partnership with banks and other NBFC’s assets.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So I don’t think there are any new rules that have come out from the RBI on co-lending. I think what you have seen in the press over the last few weeks is some amount of coverage on, looking at the books and looking to see if the way business is done in co-lending is very similar to what you would do if you had to do all of that lending on your own books. I think that was what it is. But unless there is something else that we have missed, we’d be happy to hear from you on what the RBI has said towards co-lending.

Unidentified Participant — — Analyst

Okay. And the second thing would be, like what kind of agreement have entered with U GRO Capital as it is in business loan and what will happen in the case of any default?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So with U GRO Capital, we have a co-lending business — co-lending agreement where it’s a sourcing, servicing and collection that we do for them, just like we’ve signed up with most of the others. So of the five agreements we have, four of them are on the gold loan side, one of them is on business loan side. And on certain other details, I think it’s — the risk is pari-passu how it is with the lending proportion that gets done.

Unidentified Participant — — Analyst

Okay. Sir, the loan would be like with no collateral or like there’ll be collateral?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

No, these are secured business loans. The one that you’re talking about, yeah.

Unidentified Participant — — Analyst

[Speech Overlap] Okay. And some light as well on the recent partnership with HDFC Bank and DCB Bank. Like what is the ratio? And any amount fixed with them, like if there is any amount of default and how it would be funded?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So we would not like to give any color on the amount of the line that they have given to us in the partnership, but we started with DCB at the end of March, HDFC is a very, very new partnership for us. In fact, it’s just barely about a week to 10 days old. So we still have to pick traction over there that has just about started and both of them are 80/20 partnerships in terms of proportion of lending.

Unidentified Participant — — Analyst

Okay. Okay, thank you so much.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you.

Operator

Thank you. [Operator Instructions] The next question is from the line of Amit Dubey, an individual investor. Please go ahead.

Unidentified Participant — — Analyst

Hello sir. Am I audible?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Yes, we can hear you.

Unidentified Participant — — Analyst

Thanks for the opportunity, sir. So my question was that, sir, can you please explain the BC model with Shivalik Small Finance Bank. And what kind of commissions are we earning from it?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So the BC relationship with them is that we do the entire sourcing, servicing and collection, and 100% of the loan gets written on to their books. It’s no different from any other BC relationship that you’ve heard about in the industry. And we would not like to give you specifics on the commercials, just given the confidentiality on certain clauses in the agreement that are there between both the partners. But needless to say, 100% gets written on their books and we get a spread.

Unidentified Participant — — Analyst

Understood, sir. Understood. And sir, yet another question, that your thought process to integrate EZ Capital with TruCap. What is the plan for future?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

We’re waiting for regulatory approval. At this point in time, I think it’ll be fair to say that once, at least one of the regulators give approval, we can then spell out all the details.

Unidentified Participant — — Analyst

All right, all right. Sir, the — last question, sir, that, is there an amount of disbursement determined for each quarter in the agreement? Because we got into co-lending relationship with the Central Bank of India for an amount of INR1,000 crores in an 80:20 ratio. So any default from here as well? Is the Central Bank of India’s co-lending interface all digital?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So we have had no defaults from the Central Bank of India co-lending relationship so far. We’ve — they are our largest partner, the lion’s share of disbursements have happened. But then, given the fact that we signed up with them from August 2021, so almost 90% of the disbursements that we have done overall in co-lending and we’ve spelled out the numbers in the presentation, which is almost INR300 crores, has happened with the Central Bank of India. Of that INR300 crores, almost 90% has happened with them. There have been no gross NPAs on that book so far.

Sorry, your second question was? I’m forgetting your second question, sorry. Can you repeat that, please?

Unidentified Participant — — Analyst

Yes, sir. Am I audible.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Yes.

Unidentified Participant — — Analyst

Is the Central Bank of India’s co-lending interface all digital?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So, it’s a phygital process, it’s not fully digital yet.

Unidentified Participant — — Analyst

Understood, sir. Understood. Thanks a lot, sir. That would be it from my side. Thanks [Speech Overlap].

Operator

Thank you. [Operator Instructions] The next question is from the line of Abhishek Jain from Arihant Capital. Please go ahead.

Abhishek Jain — Arihant Capital — Analyst

So what is the rejection rate in your business? And if your any application got rejected with one of the bank, do you apply for any other bank also? Or you put it on hold for some period of time? How exactly it works out? My first question.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Sorry, I may not have understood your question fully when you say what’s the rejection with the bank.

Abhishek Jain — Arihant Capital — Analyst

Like if you go for a loan right now, someone apply for a loan and there is a rejection for any scenario, whatever the reason is there, what is the rejection rate generally when you –? And like if a loan has been rejected by one particular organization, let’s say where you have a co-lending agreement, how exactly it works out? Like you’ll be trying for another bank or you’ll keep it on hold for a certain period of time?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So to answer your second question, if we’ve applied for a loan from a lender, and for instance, if it gets rejected, there’s usually a six-month waiting period until you can apply again, if it goes to the committee and the committee rejects it. When you’re talking of co-lending applications, and for instance, if we’ve applied to be a co-lending partner with someone and it’s getting rejected, I think that is highly unlikely, because usually, there is a lot of discussion that happens before it goes to either of the committee, either our Board committee or their Board committee either on process, product, policy, all of that is discussed well before they are taken. Now, on a term-loan application, if your application gets rejected, like I mentioned to you, there is a six-month cooling-off period before which you can apply for another loan, that’s a term-loan. And in the regular course of business today, we’ve got about 28 lenders. I would say that, knock on wood, we’ve been fairly fortunate with getting large lenders like SBI, Bank of India, Central Bank of India, DCB Bank, and many others on to our roster. Obviously, there are some lenders who may give up on and — who may give up on not giving you a loan application, at this point in time, that’s just a function of either capital that’s just a function of them not wanting to be giving on lending towards a certain product, etc. That’s a regular course of business. I would say, it’s about one in 10 or so applications that happens.

Abhishek Jain — Arihant Capital — Analyst

Okay, thank you, sir. Sir, one more question, how you foresee yourself in next two years? What kind of book size we can see? And what will be the NIM at that point of time?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So we strive for a minimum NIM of between 8% to 8.5%, as I mentioned, that’s number one. Number two is, we are really putting a lot of emphasis and focus on lending-as-a-service. We have done that from August 2021. Obviously, we had a nine- to 10-month period where we had to learn all the ropes. The integration is the biggest challenge over there. However, in the last two years, you’ve seen the book has grown very well. In the last fiscal, our AUM growth has been 90%. We strive to be a large lender and a large service provider to even much larger lenders. I would not want to give any specifics on numbers in terms of where we would be in AUM two years hence, but our plans are fairly ambitious.

Abhishek Jain — Arihant Capital — Analyst

And how you see — what kind of challenges you can see — like are you seeing any slowdown at this point of time? People are[Phonetic] talking about some slowdown in the activity. So are you facing any slowdown in the demand? Like the number of applications, are you seeing any slowdown?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

No, we are not, at least in our business and the geographies that we are serving in. So just to let you know, for both the products, gold and business loan, we are not a Pan-India provider, we are very selective on the states we operate in, which are namely the seven states that I spelt out. In those states, from time-to-time, there is a certain amount of competitive intensity that kicks in. So usually during Diwali or during wedding season, for instance, in particular states. At that time, it becomes sometimes more competitive either on loan growth or on pricing, but nothing really that we’ve seen, that is — that I could say is a slowdown. In fact, the number of log-ins or the number of leads has picked-up, that’s also a function of not just the macroenvironment, but also micro marketing efforts that we are taking, be it on the digital front, be it on the individual branch front from state-to-state.

Abhishek Jain — Arihant Capital — Analyst

And how would you decide [Foreign Speech] which you’d be going when you are applying for a one particular loan? How would you decide [Foreign Speech] you’ll be going with certain one particular lender or one particular co-lending partner, what is the process — what is the thought process when choosing a co-lending partner for one particular application?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So I would say, more than anything else, I think we are fairly fortunate that these large lenders have chosen us. I don’t think we would want to choose — or we could choose who we really want to be with. Obviously, we are given that choice, but it’s a privilege for us to be associated with these lenders, five lenders who are much larger than us. So that’s something that we are very thankful to them for. On your question is — in terms of how we decide to tie-up with them, it’s a fairly long process. So it’s not just about tying-up with them because tying-up with them also means they have to be comfortable with your product, process, policy, people, corporate governance, etc., with the amount of capital you have in your balance sheet, your ability to write the kind of volume that they expect either on a monthly or a quarterly basis. The integration is the biggest challenge, and that takes even more time than tying-up with the lenders. So once you get into that kind of a marriage, then you have to be fairly strategic in terms of what kind of volume you can give to those lenders, number-one, because there’s a lot of time, energy money and bandwidth that gets used up in this whole process. And number two is also then making sure that the vintage of the book remains very healthy, because that is the key to having a long successful marriage with these lenders.

Abhishek Jain — Arihant Capital — Analyst

Thank you. Thank you.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you.

Operator

Thank you. [Operator Instructions] The next question is from the line of Drashti Shah, an individual investor. Please go ahead.

Unidentified Participant — — Analyst

Hello, sir, am I audible?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Yes, ma’am. We can hear you.

Unidentified Participant — — Analyst

Sir, I have couple of questions, the first one being, so we — like you said, we increased our customer base. So could you please provide a breakup as to the customers we’ve onboarded digitally, through Dhan Setu vis-a-vis the offline mode.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So the majority of the customers today also still come from the offline mode. Through Dhan Setu, it’s still fairly young. I think last quarter was the first quarter — last quarter, meaning, sorry, the December quarter was the first quarter that we onboarded a good amount of customers in Dhan Setu. We are continuing to do that. In the gold loan product, almost all of it is offline, but the process of onboarding a customer, once the customer comes into the branch, is entirely digital. The entire process for a business loan product also is entirely digital, so you don’t really require much in terms of physical documentation. So it’s a phygital effort. But one thing that I would like to spell out fairly assertively is that, it’s very important to understand that, for us, as an NBFC, at least, what we have realized and what we have decided in terms of our course going forward is that tech is largely a big enabler towards doing much more scalable business. We are never going to be an end-to-end digital player that does not do any personal discussions, for instance, or does not have any physical touch point with the customer. I think that would not be in our D&A. But we would like to process everything digitally. So it’s a combined effort, both physical and digital, and that’s why it’s called phygital.

Unidentified Participant — — Analyst

Understood, sir. Sir, like you said about technology being the integral. So my second question is that, like you said that significant financial investments have been made in the technology aspect. So how is Money Rabbit working out and when do we see that coming live?

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

So at this point in time, what we did is, we have three tech assets. One of them, as I mentioned to you, Dhan Setu. The other one is a B2C platform that we have yet to go live with. B2C, as you can imagine, you can spend an inordinate amount of marketing dollars in trying to market it and the ROI on that is sometimes very far out. So we are trying to see what we do with the B2C platform to make sure that it enhances the gold loan business specifically for us, that’s on the second one. The third asset, which is Money Rabbit, was largely a consumer wellness and financial wellness platform along with a lending module associated with it. They’ve posted[Phonetic] digital lending guidelines that came out early last year, that has been put on hold. The entire front-end and back-end for it is developed and we’re working with someone right now to see how best we can monetize it. So is it something that we monetize, is it something that we can white-label for others to use that we can generate a revenue stream for, or is it something that we use predominantly in our business to enhance the business further? That is a work in progress right now and you’ll hear more about that, I would say, in the next six to eight months.

Unidentified Participant — — Analyst

Okay, sir, understood. Thank you. All the best.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you very much.

Operator

Thank you. [Operator Instructions] As there are no further questions, I now hand the conference over to the management from TruCap Finance Limited for closing comments. Over to you, sir.

Rohanjeet Singh Juneja — Managing Director and Chief Executive Officer

Thank you very much for joining our call today. We look forward to talking to everyone on the next quarterly call. Thank you. Have a good evening.

Operator

[Operator Closing Remarks]