Commercial Credit PLC Encourages Fixed Deposit Investments
By Neeta Nicholas
A registered Finance Company under the Central Bank of Sri Lanka (CBSL) with an extensive branch network across the country, Commercial Credit PLC offers a wide portfolio of products and services such as Leasing and Hire Purchase, Personal Loans, Real Estate, Gold Loans, Fixed Deposits, Micro Finance, Quick Cash and Educational Loans.
Commercial Credit has two main categories of deposits namely Fixed Deposits and Fixed Savers Deposits. Fixed Deposits enable customers to invest their money in return for a lucrative interest, paid on a monthly basis or at maturity on the capital invested, based on its tenure. The period of deposit ranges from a month to 60 months and the minimum deposit should be Rs. 5000/-
Fixed Savers deposit products are mainly four types as detailed below:
• Punchita Panchita caters only to children below the age of 18. They are given a ‘till’ and encouraged to save on a daily or monthly basis. Birthday gifts, emergency insurance cover, bonus interest and many more rewards are offered to young depositors in order to encourage the savings habit.
• Daily Savers is a daily deposit system where Commercial Credit representatives personally collect deposits from the customers on a daily basis. The minimum deposit and period are Rs. 250 and six months respectively.
• Regular Savers is similar to Daily Savers but this is a monthly deposit system and the minimum period is one year.
• One to One Bonus is exactly like Regular Savers in terms of collection, minimum deposit and period. However, the One to One Bonus interest will only be paid to customers once it is converted to a normal Fixed Deposit at maturity.
With regard to the above mentioned Fixed Savers options, while the deposit amount is at the customer’s discretion, the interest rate will depend solely on the amount invested.
“Though Commercial Credit is a new competitor in the financial sector it has overcome the recent economic disintegration due to unregulated institutions, which in turn created a liquidity crisis in the sector. It honoured many withdrawals at the time which were due to the uncertainty and apprehension created among the public,” commented Madhawa Edussuriya, Deputy General Manager during an interview with ‘The Sunday Leader’.
Depositor confidence is of paramount importance for the success of any finance company. Such confidence can be achieved both by internal as well as external factors. Internally the company should provide as much information as possible to the investor and be transparent in all its dealings.
Externally the institutions governing and regulating such companies namely the Central Bank and the Securities and Exchange Commission should insist on maintaining strict monitoring processes to ensure that the interests of investors are protected and implement further regulations to avoid a future economic crisis. Edussuriya believes that the Marketing Personnel at Commercial Credit play a key role in acting as mediators in achieving the said requirements and in helping restore and maintain investor confidence in the industry.
At the time of the change in management in September 2009, the Fixed Deposit base stood at Rs. 840 million. Since then it has escalated to Rs. 4.4 billion while growth in profits is predicted to increase to around Rs. 1.5 billion this financial year. The company’s asset base has already reached the Rs. 4.8 billion mark, a remarkable accomplishment from the Rs. 688 million asset base it had in September 2009. Commercial Credit has also successfully attracted more than 80,000 new customers which is a clear sign of the confidence the general public has in the organisation.
The company was listed on the Colombo Stock Exchange on 1st June 2011 to keep in line with the requirement of its supervisory body the Central Bank of Sri Lanka.
Edussuriya said that the CBSL has granted an endorsement for the expansion of Commercial Credit’s services to Gampaha, Moratuwa and Nugegoda so that it can extend the same level of exceptional service and enhance its presence in the country.
Backed by an enthusiastic and dedicated workforce determined to reach innovative levels of performance and service, the management of Commercial Credit PLC continues to strive to live up to its corporate goals; to be the best finance company of its kind, create long-lasting relationships with its customers, build a zealous, motivated and learned work force and shape an environment in which all stake holders are proud to be a part of.