experience of our Independent Directors helps ensure transparency and accountability in our operations across diverse
functional aspects and their inputs enhance quality of our operations.

Our operations are also funded by growth capital provided by a diverse group of investors, including development finance
institutions such as International Finance Corporation and DEG, private equity investors including Lok Capital Growth
Fund, Gaja Capital India AIF Trust (represented by its trustee, Gaja Trustee Company Private Limited), Gaja Capital
Fund II Limited, ASK Pravi Private Equity Opportunities Fund and Jhelum Investment Fund I, institutional investors
such as HDFC Life Insurance Company Limited, IDFC FIRST Bank Limited and Kotak Mahindra Life Insurance
Company Limited and family offices such as Kiran Vyapar Limited and Polaris Banyan Holding Private Limited. We
believe this reflects the credibility of our business operations and corporate governance standards.

Strategies
Expand our asset portfolio while focusing on secured lending

We expect the Indian market for inclusive finance and general banking to continue to grow in the foreseeable future. The
micro finance industry grew by 16% year-on-year to reach 2 3.3 trillion as of March 31, 2020. The overall growth of
microfinance sector in the current fiscal is expected to reach 2 3.5 trillion owing to high sensitivity of the sector towards
external shocks. The growth in micro finance is expected to come from increasing presence in the newer states, expanding
the client base and increasing the ticket size gradually (Source: CRISIL Report). We aim to grow within our existing
geographies as well as in new geographies in a calibrated manner based on our analytics and intelligence on industry
growth. Our focus will continue to be on the inclusive finance segment in line with industry growth. We intend to continue
to grow our inclusive finance portfolio in line with the projected growth in the industry.

We also intend to grow our secured portfolio which we believe will grow at a faster pace as compared to inclusive finance
portfolio due to its comparatively small base currently. Amongst our retail asset products, we are focusing on lending for
commercial vehicles, home loans, secured business loans, and micro business loans. In the backdrop of BS-VI transition,
financing is expected to be stronger in case of used commercial vehicles as transport operators are likely to shift towards
cheaper BS-IV vehicles because of a jump in prices of new BS-VI vehicles (Source: CRISIL Report). Our focus will be
to develop loan products for the used vehicle segment targeted at small and retail transporters with existing operations
and experience. We also intend to continue to advance commercial vehicle loans to large fleet operators and OEM’s to
maintain and strengthen our existing relationships with these key customers. We intend to digitally onboard a potentially
large customer base by offering small ticket overdraft loan facilities, in particular to our targeted customer segment, i.e.,
small and retail transporters.

Our affordable housing finance segment will be a key focus going forward. We anticipate growth in this segment from
areas where we have an existing presence. Our focus will be to disburse loans to self-employed and salaried individuals
for non-agricultural properties and in particular in the affordable housing segment and leverage our existing inclusive
finance distribution reach and customer base to source home loan customers. Our micro unsecured business loan portfolio
will also be key focus to grow in the future. Customers in this segment primarily include retail store owners that require
funds to support their businesses including for stock fulfilment and shifting away from unorganized lenders lending at
higher interest rates. We have introduced an overdraft facility for these customers to support short-term working capital
requirement thereby partnering with them for long term over the life cycle of the loan. Our secured business loans are
financed to MSMEs/ SMEs and to corporates for business purposes including funding their growth and expansion. We
plan to deepen our relationship with such customers by opening liability accounts and selling third party products.

Strengthen our retail liability franchise

We intend to strengthen our liability franchise growing our CASA and retail deposit base in a steady manner. Our retail
deposits comprised 41.21% of our total deposits as of March 31, 2018 and grew to 42.91% as of March 31, 2019 and to
54.44% as of March 31, 2020 and were 72.40 % of our total deposits as of December 31, 2020. As a result, our Cost of
Funds has reduced gradually from 10.71% in Fiscal 2018, to 8.99% in Fiscal 2019 and to 8.55% in Fiscal 2020 and was
8.05% (annualized) / 6.04% (unannualized) in the nine months ended December 31, 2020. In order to grow our retail
deposits, we have set up a dedicated team for acquisition of retail deposits across regions and a product development team
to enhance the features of our existing products and develop new products. Our strategy will be to build relationships
across various customer segments including with senior citizens, NRIs, educational institutions, NBFCs, corporates and
co-operative banks. As of December 31, 2020, senior citizens and NRI deposits formed 20.78% of our deposit base and
ensure long-term relationship with our Bank. We believe that the lower number of outstanding customer complaints
indicate high customer service levels. Complaints outstanding as of March 31, 2018, 2019 and 2020 and as of December
31, 2020 were nil, 17, 12 and 66, respectively. Our average turnaround time for resolving complaints has been 5.47 days
in the last three Fiscals and was 11.94 days in the nine months ended December 31, 2020. Our focus will be to drive
productivity and add more relationships. We intend to deepen relationships with our asset customers over the next few

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