IDLC Finance Limited
Following an illustrious career spanning various top organizations of the country, in August 2016, Mr. Jane Alam Romel decided to take on a new challenge by joining IDLC Finance Ltd as its new Group Chief Marketing Officer. Immediately in his new job, Mr. Romel became determined to make a big impact and take the company to new heights right from the beginning. So he looked at the industry as a whole with a fresh perspective, so that he can find areas for innovation. Now the industry mostly revolved around the ideas of a few generic, commodity services such as – credit card, home loan, car loan etc. and the odd gimmicks like a new branch opening, customer nights etc. Mr. Romel knew that to stand out from the crowd, IDLC Finance had to do something new and original. He also believed that each company should stand for a cause other than focusing purely on its core business. Just like Apple, Starbucks and the other globally loved brands, IDLC should also stand for a cause that could create a sense of belonging and community. Thinking about all the possibilities, all on a sudden a brilliant idea hit him- the youth. The youth themselves hold limitless possibilities and they are the future. Unlocking their potential with proper help and support can be the rallying call that makes IDLC Finance a distinct image in the market. From that line of perspective came the big idea – “Shombhabonar Shopno.” But an idea is just 1% of the work. There would obviously be an enormous range of challenges and difficulties to be overcome so that the plan can be the kind of success Mr. Romel has become accustomed to all his life. Will the board believe in his plan? Does he have the system and resources in place to pull it off? That is where the first challenge was- approval and execution.
The largest multi-product, non-banking financial institution to be formed in Bangladesh is IDLC Finance Limited. It was established in 1985 by the initiation of the International Finance Corporation of the World Bank which collaborated with German Investment and Development Company, Aga Khan fund, Kookmin Bank, The City Bank Limited and Sadaran Bima Corporation. Though IDLC was introduced as a leasing company, it extended its working area and changed its name from Industrial Development Leasing Company to IDLC Finance Ltd in 2007. It is basically a financial institution operating to cater to the needs of big corporations, small and medium enterprises (SMEs) and a significant presence in the capital market through its own subsidiaries; IDLC Investments Ltd and IDLC Securities Ltd. It engages in investment banking, discretionary portfolio management and margin lending activities.
These activities are divided into four categories where different products are delivered for Corporate division, Consumer division, SME division and the Capital Market. In corporate finance, products ranging from lease financing to project financing, advisory services and securitization of assets are provided to clients and in SME division they provide SME loans/leases, women entrepreneur loans, revolving short term loans, etc.
Their vision is that IDLC will be the best financial brand in the country along with their current mission which states, “We will focus on quality growth, superior customer experience and sustainable business practices”. To support their mission, they have outlined a few strategic objectives: they want to grow and develop their talent pool so that new ideas can surface every year, fully leverage new core banking platform, optimize distribution points, grow and diversify funding sources to meet the demands of growing customer base, grow sales and service capabilities in consumer division, aggressively grow SME loans as Bangladesh has seen a sharp growth in small businesses recently, focus on top tier clients in the corporate division, consolidate capital market operations and enhance capabilities, embrace corporate governance and sustainable business practices.
IDLC finance Ltd announced consolidated earnings for the year ended on December 31, 2016 with a consolidated EPS of BDT 7.08 and NAV per share of BDT 35.56 and a profit sharing scheme of 70:30. For the clients IDLC provides skilled professional service at minimum cost with tax rebate opportunity where the minimum investment amount for corporate and individuals need to be 10lacs.
To continue its merchant banking activities IDLC formed a separate subsidiary called IDLC Investments Ltd where they have a margin loan department for capital investment accounts under research and a finance and control department for the external and internal audit under investment banking. The purpose of IDLC Investments is not only to construct, maintain and evaluate portfolio but also supporting activities like investment banking, research, etc. for the institutional and individual investors alike. There are two account types in the portfolio management wing, called the non-discretionary and the discretionary portfolio account. The first one facilitates capital investment where it provides margin loan facilities to the investor managing his own portfolio; clients can trade their shares whenever they want to providing a safe channel for educated investors. The latter refers to a more disciplined investment process. This provides services like MAXCAP for high net worth clients, profit loss sharing scheme, capital protected scheme where the clients will not incur any losses and easy invest for affordable investment plans. The minimum investment amount for the above-mentioned services are 10lacs except easy investment where it is a mere 3000 BDT. Portfolio managers invest in a very structured way in both capital market and money market securities approved by the SECB/Bangladesh Bank.
Their superior portfolio management techniques are backed by strong research done by competent fund managers all to prove that IDLC is a robust financial institution where investors money is always protected; this goes on to say that the firm feels strongly responsible about its clients and by backing individual investors, SME loans and women entrepreneur loans they show to some extent that they do believe in financing happiness. Not only are they involved with professionals but they have made a strong impact on students by sponsoring business case competitions on financial modelling and valuation, Blueprints, organized by the Finance Club of one of the top private universities of Bangladesh, North South University. Their objective was to educate the participants on real life financial investments further strengthening the financial knowledge of the country’s young population. The sort of services they provide and how they manage to provide it unveils their encouragement to general and institutional investors to develop the investment sector in Bangladesh and induce productivity which will eventually lead to a happier and educated Bangladesh.
“Shombhabonar Shopno” was based on the idea of helping the young and energetic minds find their potential with extensive help and support that IDLC Finance Ltd. was willing to humbly provide. But the whole campaign stands for more – it stands for building a better and brighter future for the country.
That being said, here is where the part gets tricky – selling the idea to the board and executives. Recent events have already put the country [u1] in shock and as we know, the youth are in danger of losing their ways[u2] . Will they agree to this big budget program? This too considering the fact this will not bring in any immediate return and it is mainly focusing on the long-term. Will this be a campaign worth going for?
Again, could this change the way people look at financial institutions? People think financial institutions are nothing more than peddlers of money and loans. This had to be changed when people thought about IDLC because IDLC Finance Ltd. stands for something more. But will this be possible? Can the perception actually be changed?
Then comes the challenge of communicating this change properly. After 10 years, there might be results that benefit the company but till then, how will IDLC remain in the youths’ minds? Who to take and how to create an engagement?
So many challenges faced Mr. Romel! He was tensed but he knew what he believed in and what he was planning to do. He was ready to take them on and bring success home.
What happens next?
The Board loved the idea and was willing to get it rolling as soon as possible. Mr. Romel started his planning for the next steps and with his brilliant team of marketers in IDLC, there came several wonderful events and the communication was made engaging.
The campaign starts off and the ideas take flight.
Progress till now
The campaign has brought to light a few exciting and ingenious events and programs that has been appreciated by all- young and old alike.
Promoting the works the brilliant youth- the likes of Ayman Sadiq (10 Minute School), Korvi Rakshand (Jaago Foundation), Osama Bin Noor (Youth Opportunities) and many other inspiring youth were asked to help the new generation be inspired and share their ideas on how to take on the challenges and start something brilliant. Their stories were shared on Facebook and through ATL tools like billboards they were communicated superbly with the mass. Then the youth were asked to submit their own stories of their own projects/startups/ventures to help connect each other and even provide help and support if necessary. Massive response was gathered just from Facebook alone with likes soaring more than 21,000 in most of those stories and views reaching up to the massive numbers of 21 lacs.
Then came another brilliant idea for Shakrain. The plan was to bring new Dhaka people to the old town and celebrate the festivity together. Many know what happens in celebrations during Shakrain but most did not know the story behind it. The way it is related to finance was promoted in this event. Also, this was a small initiative to spread smiles and creative festivity amongst the people.
Purnota Fair for the female entrepreneurs was a highly responsive and exciting event as many leading female entrepreneurs were invited to share their stories and take classes. The fair was aimed towards empowering women entrepreneurs, by giving them a platform to showcase and sell their products to the visitors of the fair.
One of the most touching and impactful event was held during Pahela Baisakh. Unfortunate kids who could not afford to enjoy the day were brought together and a fair was organized for them with games, food and fun time all together. Most institutions deliver sweets or something generic but IDLC believed that it should be something more – something memorable and special for those who deserve it.
Measuring the outcomes
Particular KPIs (Key Performance Indicators) were set for the events and promotions. For digital media, dashboard was used to measure the likes, comments, views and shares. The more interactive these were, the higher the performance measures. Till now the highest likes measured from the stories were 28,000 along with 4,000 comments till now and views of 21lacs.
For other non-digital platform promotions, the number of applications for loans, contacts in relation to these prospects and more are used to measure the performance of these promotions.
Will it work?
The campaign seems to be going well for now but, as always, there is plenty of uncertainty regarding the outcome. Will people take it? Will they accept the positivity and will the positivity spread? The whole purpose of this campaign is to target the youth with inspiring tales and create a positive change so that down the line, 10 years into the future or so, IDLC can help these young and brilliant minds in one way or the other. What else could be done? What is missing? And how can this be made better? These are the questions that run in the mind of Mr. Romel now. Who knows? Maybe there is an even better way of making this campaign a success!