Axis Bank is in talks to acquire Spandana Sphoorty, which is also reportedly open to exploring a complete sale, say people in the know. Interest in this deal has been evinced on both sides and it has been in the works for a while, the sources shared.

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Axis Bank is looking at reducing its priority sector lending (PSL) cost with the acquisition.

Spandana Sphoorty’s customer base will not only help it expand its base but will also give Axis Bank the ability to cross-sell its various products and services.

Spandana Sphoorty has been open to a sale proposition. Axis Bank as a large parent and lower cost of funding will help its business.

Axis Bank declined to comment on the query.

E-mails to Padmaja Reddy, Founder & MD of Spandana Sphoorty, did not get a response.

Spandana Sphoorty Financial is a non-banking financial company - microfinance institution (NBFC-MFI). The company is primarily engaged in the business of microfinance providing small value unsecured loans to low-income customers in semi-urban and rural areas.