In 1985, Uday Kotak founded Kotak Capital Management Finance Limited as a financial services company with a loan of ₹30 lakh from family and friends.[8] In 1986, Anand Mahindra and his father Harish Mahindra invested ₹1 lakh in the company which was subsequently renamed Kotak Mahindra Finance.[9] The company was initially engaged in bill discounting, along with lease and hire purchase activities.[10]
In the early 1990s, the company started offering car financing and investment banking services and expanded its operations overseas. In 1996, car financing company Kotak Mahindra Primus was incorporated as a 60:40 joint venture between Kotak Mahindra Finance and Ford Credit International.[11] In the same year, Kotak Mahindra Finance hived off its investment banking division into a new company, Kotak Mahindra Capital, started in partnership with Goldman Sachs.[12]
In 1998, Kotak Mahindra Finance started its mutual fund arm called Kotak Mahindra AMC.[13] In 2001, OM Kotak Mahindra Life Insurance was established as a 74:26 joint venture between Kotak Mahindra Finance and Old Mutual.[14]
In 2005, Kotak Mahindra Bank acquired Ford Credit's 40% stake in Kotak Mahindra Primus, making it a wholly-owned subsidiary of the group.[17] Kotak Mahindra Primus was subsequently renamed as Kotak Mahindra Prime.[18] In 2006, Kotak Mahindra Bank bought out Goldman Sachs' 25% stake in Kotak Mahindra Capital for ₹210 crore (US$46.35 million) and 25% in Kotak Securities for ₹123 crore (US$27.15 million), turning both companies into its wholly-owned subsidiaries.[19]
In 2014, Kotak Mahindra Bank announced the acquisition of ING Vysya Bank in a deal valued at ₹15,000 crore (US$2.34 billion). With the merger completed in 2015, Kotak Mahindra Bank had almost 40,000 employees, and the number of branches reached 1,261.[21] After the merger, ING Group, which controlled ING Vysya Bank, obtained a 6.5% stake in Kotak Mahindra Bank.[22]
In 2016, Kotak Mahindra Bank acquired BSS Microfinance for ₹139.2 crore (US$20.72 million).[25]
In March 2017, Kotak Mahindra Bank launched an online savings account called Kotak 811,[26] named after the date Prime Minister Narendra Modi had announced demonetisation in the previous year (8 November), which according to Uday Kotak was "the day that changed India."[27][28] Kotak 811 helped the bank double its number of customers by September 2018.[29]
In April 2017, Kotak Mahindra Bank acquired Old Mutual's 26% stake in Kotak Mahindra Old Mutual Life Insurance for ₹1,292 crore (US$198.4 million), making the life insurance company its wholly-owned subsidiary.[30]
In 2021, Kotak Mahindra Bank sold its 8.57% stake in Airtel Payments Bank to Bharti Enterprises for ₹295 crore (US$39.81 million).[31] In the same year, Kotak Mahindra Group acquired the vehicle financing portfolio of Volkswagen Finance India[32] and passenger vehicle financing portfolio of Ford Credit India.[33] In 2022, it acquired the agriculture and healthcare equipment financing portfolio of DLL India.[34]
In 2023, Kotak Mahindra Bank acquired microfinancier Sonata Finance for ₹537 crore (US$63 million).[35]
In a study by Brand Finance Banking 500 published in February 2014 by Banker magazine, Kotak Mahindra Bank was ranked 245th among the world's top 500 banks with a brand valuation of around US$481 million and brand rating of AA+.[38][39]
In April 2024, the Reserve Bank of India barred Kotak Mahindra Bank from onboarding new customers via mobile banking, online channels, and issuing new credit cards.[41] Existing customers were not affected. The RBI cited deficiencies in the bank's IT systems as the reason for this action.[42]
