Mahindra Finance launches lease-based vehicle subscription business for urban centres

Mahindra & Mahindra Financial Services (Mahindra Finance) on Wednesday announced the launch of lease-based vehicle subscription business for the urban centres, eyeing a business of Rs 10,000 crore in the next 3-5 years.

Under a brand christened 'Quiklyz', the non-banking financial company (NBFC) said it will be the first-of-its-kind digital journey on vehicle usership aimed at catering to both the retail customers and corporates.

Under the new-age vehicle leasing and subscription business 'Quiklyz', the company will offer multi-brand vehicle leasing and subscription, targeting to reach as many as 30 cities within a year and garner a book size of Rs 10,000 crore in 3-5 years, Mahindra Finance said while announcing Quiklyz virtually.

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Mahindra Finance sees this as a great opportunity to create value for its stakeholders with a profitable business model and build a strong balance sheet out of emerging opportunities in this adjacent business vertical, it said.

Quiklyz is the first-of-its-kind digital journey on car usership with which the customer can access a brand new car without all the hassles of car ownership.

It will take care of registration, insurance, scheduled and unscheduled maintenance, and roadside assistance, among others.

"Car leasing and subscription is a lucrative and fast-growing business in India. We aim to achieve a book size of Rs 10,000 crore in 3-5 years.

"Leasing is seeing significant traction in the last-mile mobility space especially with EVs (electric vehicles), something our business module will also focus on," Ramesh Iyer, vice-chairman and managing director of Mahindra Finance, said.

The company sees it as a big opportunity to serve the urban market, especially the retail customers. Besides, it will also allow the company to design products that are suitable to the needs of the customers, Iyer told reporters.

As the leasing business is still a new concept for Indian retail customers, Mahindra Finance wants to leverage the early mover advantage by facilitating millennials and new-age corporates alike for hassle-free ownership of vehicles, he added.

To begin with, Quiklyz will launch its services in metro cities like Bengaluru, Chennai, Delhi, Gurugram, Hyderabad, Mumbai, Noida and Pune. It will further expand it to other cities across India, including tier-II cities, covering 30 locations in the next one year.

Quiklyz is also in discussions with several automotive original equipment manufacturers (OEMs) and will announce partnerships with them on leasing and subscription shortly.

Under the B2B (business-to-business) segment, the company aims to offer services to corporates and fleet operators, while in B2C (business-to-consumer) segment, it will target customers with a millennial mindset, the company said.

It will cover vehicles across all major auto OEMs, with a wide range of choices in terms of vehicle models, variants and colours.

Mahindra Finance Chief Operating Officer Raul Rebello said that with the multi-faceted advantages accruing from the Mahindra Group entities, the company's spread and reach across India will be an advantage to expand the coverage in vehicle leasing and subscription.

"The customers are looking at flexibility in vehicle ownership and with Quiklyz, we will provide a convenient way of owning a vehicle. Leasing currently accounts for 10 per cent of corporate registered vehicles, and we expect it to grow to 20-25 per cent share in the next 5 years," Turra Mohammed, senior vice-president and business head at Quiklyz, said.

He added that in the retail segment, subscriptions could account for 3-5 per cent of car sales in the next 3-5 years. "We will leverage Mahindra Group's extensive network to expand Quiklyz to 30 cities within a year."