The Hinduja group promoted bank also announced a tie-up with a payments company PayU Money, for its digital expansion. The bank's core net interest income grew 36 percent to Rs 1,173.42 crore during the reporting period on a 29 percent growth in credit, which saw the retail side outpacing the wholesale lending by a notch at 29 percent.

Excluding the recently acquired diamond portfolio, the credit growth stood at up to 25 percent. Unlike its peers, which have stitched tie ups with entities who have received payments bank licences, IndusInd preferred a company which is not among the 11 selected ones and the nature of partnership is also different, as there is no exchange of equity, its Managing Director and Chief Executive Romesh Sobti told reporters here.

He said the share of high margin retail advances rose to 44 percent and in the next three-four quarters, the loan book will be evenly split between wholesale and retail.

Its net interest margin expanded to 3.91 percent from the 3.67 percent, despite a 0.35 percent cut in interest rates during the fiscal, as the cost of funds corrected faster, Sobti said, adding there was also a rise in the low-cost Casa deposit base to 34.98 percent.

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