Japan's AIFUL plans JV with AIRA Capital
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Talks underway on setup of consumer finance firm here
Japan-based financial services provider AIFUL Corporation has announced its first investment in Thailand – its debut overseas investment – with the news it will launch a joint venture with Bangkok holding company AIRA Capital.
The consumer finance company is expected to be set up in the fourth quarter, with discussions ongoing between AIFUL and AIRA including the cost of investment and the lending target.
Yoshitaka Fukuda, president and chief executive officer of AIFUL, a top-four consumer finance company in Japan, said yesterday that Thailand was an attractive investment destination for the company as the country’s gross domestic product per capita was above US$10,000 (Bt321,000).
Fukuda said a country with GDP per capita of more than $5,000 had growing loan demand.
He said that even though there were many players in the consumer finance market in Thailand including Japanese companies Aeon and Easy Buy, the competition was not as intense as in Japan, where there were about 10,000 companies in the sector.
Thailand is a new market for the group, so it needed a local strategic partner.
AIFUL has been involved in consumer finance for 47 years and has a customer base of about 800,000.
In the first stage of the Thai investment, Fukuda said AIFUL would focus more on quality assets – meaning it would tap middle-income people, which existing non-banks were not focused on.
Nalinee Ngamsettamas, chief executive officer of AIRA Capital, said the company would hold a majority stake in the joint venture.
She said that while its initial registered capital was yet to be finalised, it would be a significant amount because of the aim to be a top-five non-bank within three years.
AIRA Capital has set an ambitious assets-growth plan in that period – Bt5.3 billion currently to Bt20 billion – with the investment in the consumer finance company part of the plan.
Nalinee said that in the first phase, the joint venture would provide only personal loans before considering introducing credit cards.
AIRA Capital has four subsidiaries – AIRA Securities, AIRA Factoring, AIRA Advisory and AIRA International Advisory (Singapore).
