SMFG India Credit, the non-banking finance arm of Japan's Sumitomo Mitsui Financial Group, is currently not seeing any major impact from the ongoing conflict in West Asia but is closely watching its loan portfolio as a prolonged war will drive up inflation further and weigh on consumption.  

The conflict has led to a surge in oil prices and disrupted supply chains. Corporates are expected to feel the pinch more and the impact should start being visible on balance sheets from June-July, Ravi Narayanan, the MD and CEO at SMFG India Credit, told Business Today.  

If the conflict drags on and costs of goods remain elevated, there may be some slowdown, especially in smaller markets, according to Narayanan. For instance, high costs may force someone to just leave an under-construction house half finished.  

"We are very closely and carefully monitoring and engaging with our customers. Our engagement with customers is now loan-by-loan in this segment of customers," he pointed.  

Around 21% of its book constitutes customers from industry segments that have a direct impact on the West Asia crisis. For instance, small hotels, restaurants, textiles, tyres and ceramics, where there will be a first-order impact of the crisis. So, the company will be monitoring segments like business loans, micro and small enterprise loans, unsecured loans, etc. with a "hawk's eye".  

Also, something to watch out for will be how the monsoon plays out this year, which will have a bearing on the rural, semi-urban economy too.   

"The last two cycles have made us more erudite in terms of stuff that we need to be careful about and not merely get enthusiastic about growth," Narayanan pointed.  

In the 2025-26 financial year, SMFG India Credit report a consolidated profit after tax of Rs 500 crore, up 13% from a year ago, while net revenue was up 26% to Rs 8,179 crore. Its total assets under management were Rs 65,300 crore.  

Beyond the near-term uncertainties, SMFG India Credit hopes its assets can grow at a compounded annual growth of around 20% over the next 3-4 years, which will help balance out the business cycles.  

"The whole idea is to see how best we can remain ahead of the pack in terms of the industry and yet be able to calibrate and protect ourselves responsibly in the cycles that come in either at a segment level or a geography level or at an industry level," stressed Narayanan.  

Key to this growth will be the secured business. The company intends to grow its secured loan book to 60% in 3-4 years from around 44-45% currently. 

The company's affordable housing arm, SMFG India Home Finance Co, has been clocking over 25% growth over the last three years. It has 200 branches now predominantly in the west and south India and it has plans to expand more in the north.  

"It's already a Rs 13,000-crore AUM company, and we would like to ensure that kind of grows at 25-27% over the next couple of years," said Narayanan.  

Middle class households in the non-urban areas, typically tier 3 and tier 4 centres where financial intermediaries may not be reaching as much as demand is where the home finance company is targeting its growth.  

Sumitomo Mitsui Financial Group (SMFG) had acquired a majority stake in Fullerton India Credit Company in 2021. 

Earlier this year, SMFG infused Rs 1,075 crore in SMFG India Credit through a rights issue. This should support the company's next phase of growth, including in the affordable housing loan segment.  

"Some of it will be used to ensure that we are able to give impetus in the growth of affordable financing. We also want to grow across these vectors where I see group synergies, like push into loan against property, push into some of the vehicle loans as a rural entity, two wheelers are very prevalent in that economy...," noted Narayanan.  

The company's parent SMFG already has tie-ups with large Japanese OEMs (original equipment makers) and SMFG India Credit is exploring how these group synergies can be harnessed and how the company can aid them in scaling up in rural markets where it has deep presence, he added. 

Published on: Jun 11, 2026 4:20 PM IST