PMF Finance anticipates further growth; unveils new brand identity

From left: CEO Nalin Wijekoon, Director Nirmal De Silva, Director Rangana Koralage, Chairman Chandula Abeywickrema, Director Travis Waas, Director Krystle Reid Wijesuriya, and Deputy CEO Terrance Kumara – Pix by Upul Abayasekara

• Takeover by Sterling Capital sees PMF exceed Capital Adequacy Ratios
• New brand, team and products to service market under changing conditions

By Darshana Abayasingha

PMF Chairman Chandula Abeywickrema

PMF CEO Nalin Wijekoon

CBSL Assistant Governor J.P.R. Karunaratne

People’s Merchant Finance PLC on Friday unveiled its new mantle, PMF Finance PLC, as part of its journey to relaunch and revitalise the brand and its strategic priorities.

With over 81% of shareholding Sterling Capital Investments Ltd., PMF now stands for path-maker frontier finance, and has surpassed capital adequacy and other mandatory requirements listed by the Central Bank of Sri Lanka.

The company unveiled its new brand and identity at an event in Colombo last week, and aims to become the go-to-brand for the people’s financial needs.

Chairman Chandula Abeywickrema said: “We are conscious of the major socio-economic challenges prevalent in the globe and especially here at home. In a time like that there is greater demand by stakeholders to be relevant. We want to create more access to services, and we have brought internal transformation to ensure changes to meet our objectives. Accordingly, after 10 years of continuous losses, we have changed the dynamics to a profit-making entity and doubled it. There have been various cycles in our economy over the past five decades, and despite the challenges we can turn things around onto an acceptable path.”

In 2019, Sterling Capital completed its takeover of PMF with an investment of Rs. 1.36 billion through a private placement of shares and rights issue. The company is a leading exporter of Japanese vehicles to Sri Lanka and other markets in Asia and Africa. The Group subsidiary is Sterling Automobiles Lanka Ltd., which operates Sterling Aftercare Guarantee Centres.

“The Non-Banking Financial Institutions (NBFI) sector represents only 5.5% of the overall financial sector; however, it plays an important role in the economy by channelling credit to the SME sector, which contributes to over 52% of the overall economy. The recent survey shows that financial literacy has improved from 36% in 2014 to around 58% in 2021, which is a great achievement. There are a lot of unauthorised deposit-taking institutions and cause significant problems. This is something the NBFI sector must think of. It is also important for the sector to consider an important role in consumer protection; they must improve some of the practices adopted by some NBFIs. I hope this won’t be just a name change, but a change of the whole business model to support the National Financial Inclusion Strategy of the Central Bank,” said Central Bank Assistant Governor J.B.R. Karunarathne, addressing the occasion.

The Assistant Governor added the NBFI sector has endured many distresses over the past 30 years, including over 13 company failures resulting in significant losses to depositors, causing instability in the financial system. The Central Bank has taken many steps to improve the stability of the sector, including the implementation of the consolidation program in 2020. PMF Finance had not been compliant with the core capital requirement then, but the company has now complied with a high capital adequacy ratio which measures the strength and stability of the institution and the sector, he said. Karunarathne stressed the importance of good governance, compliance, transparency and sound risk management to ensure the sustainability of the sector considering the market.

“Many failures are due to over expansion without identifying the business model. You cannot always follow the other. In Sri Lanka many companies want to follow the other, but without capacity. The right model is very important,” he added.

The continued opening of physical branches coupled with the use of technology for virtual and remote access to PMF’s financial products and services will remain a key priority of the company in the medium to longer-term. New product development initiatives and process enhancements will enable PMF to ensure the availability of financial services to meet the diverse and varied financial needs of customers, the company says. Furthermore, offering products and services at the right price, at the right time, to the right customer is the ‘strategy of affordability’ followed by the company to fulfil its goal for inclusive financial services to the people.

The new brand will continue to support these efforts and bring to the limelight the company’s beliefs at any given opportunity creating a cohesive message for not only customers but all stakeholders.