Mahindra & Mahindra Financial Services Ltd will venture into life, health, and general insurance as the non-banking financial company looks to diversify beyond vehicle loans.

The company’s board of directors approved undertaking supplemental business activity of soliciting and procuring insurance business as a “corporate agent” in the areas of life, health and general insurance, both group and individual, it states in a regulatory filing.

The NBFC will seek approvals from the Insurance Regulatory and Development Authority of India (IRDAI) and a no-objection from the Reserve Bank of India (RBI) and other regulatory authorities.

In terms of financial commitments, the company plans to make an initial investment ranging from approximately ₹5 crore to ₹10 crore. This capital will be allocated for technology infrastructure setup, recruitment of manpower, and covering training and certification expenses, as per the company.

“The expected net fee income from the said business could be approximately 0.1% to 0.2% of its standalone average assets over the next 1-3 years,” the company reveals in an exchange filing.

In an interview with Fortune India earlier in September, Anish Shah, CEO of Mahindra Group and managing director of Mahindra & Mahindra, said Mahindra Finance is developing other verticals as it looks to diversify a little more.

Mahindra Finance is leveraging technology and data to improve the asset quality, Shah said. “Mahindra Finance needed to address concerns on asset quality which it has. It needs to get industry-best processes and technology and that work is underway right now. We have gone through one and a half years of that. We need about a year and a half to complete that. It should have a very strong set of processes and technology,” he said.

Insights were shared regarding Mahindra Finance's strategic approach. The incorporation of technology and data, combined with a steadfast commitment to preserving asset quality, stands out as a pivotal driver in elevating the overall business value within Mahindra Finance.

M&M Finance

M&M Finance forays into life, health and general insurance