Arohan Financial Services Limited | Annual Report 2021-22

Managing Director’s Address Greetings, I am delighted to connect with you again through the Arohan Annual Report for the Financial Year 2021-22 and sincerely hope that you and your loved ones are doing well as we exit the pandemic and get back to normalcy. I will discuss the key developments of last year and how we look forward to the new financial year with a comprehensive update to all of you. Our DRHP application to SEBI, which was filed in February 2021, was approved with a ticket for an Initial Public Offering (IPO) valid for a year till April 2022. Just as we thought that the COVID-19 pandemic was behind us, we were struck by Wave II in the middle of April 2021 - with localised lockdowns based on state-specific restrictions. The Reserve Bank of India, our regulator, did not announce any moratorium like in the year 2020 but responded with the Resolution Package 2.0 to help standard borrowers avoid becoming a Non Performing Asset (NPA) by lowering of their monthly repayment obligations to lenders. Our IPO road show presentations were received well with an anchor investor and two bancassurance partners confirming their participation. Unfortunately, the aftermath of the second wave of the pandemic and the differences in accounting and provisioning methodology across banks and non-banks made potential investors put their decisions on hold for most part of the last year. Assam, which was one of the best states in the country for microfinance business till the year 2019, had experienced local activism in 2020, leading to demands of a loan waiver during the state elections in early 2021. Under the inspirational leadership of the new Chief Minister, the first cabinet decision was to address the microfinance issue in the state. The sector, led by Microfinance Institutions Network (MFIN), our industry Self-Regulatory Organization, was able to work with the state MFI Committee, the Reserve Bank of India, and all the lenders to detail out an incentive and relief package for the government to announce as the AssamMicrofinance Incentive and Relief Scheme (AMFIRS) 2021. This is the first ever microfinance package across India and has been rolled out across three categories with incentives for regular borrowers and support for overdue and NPA customers as of March 2021. Once the scheme is fully implemented over the period 2021-2023, it is widely expected to get the state back to normalcy in operations with regards to microfinance. I am honoured to be the Lead of the Steering 14 Annual Report | 2021-2022