Sundaram Finance will review co-loan to add more asset classes: MD Rajiv Lochan


who built a loan business by financing the purchase of trucks is preparing for the next phase of growth by financing more asset classes amid a possible boom in rural incomes and government infrastructure projects, has declared its general manager.

While its traditional way of doing business, such as physically interacting and checking clients’ creditworthiness, is unconventional, it would take advantage of digital, technology and data without compromising its philosophy of security and Client orientation.

The company, which has branched out into financing passenger cars, construction equipment and farm equipment in recent years, would consider co-lending to create new asset classes, said Rajiv Lochan, a former McKinsey consultant who is now managing director of the Chennai-based lender.

“The opportunities for growth and prosperity over the next five to ten years are unprecedented,” said Lochan, who succeeded TT Srinivasaraghavan, who led the company for 18 years. “What will be different is probably technology, digital and data … Below the waterline, more empowerment will happen through technology and data science, it will be different.”

Sundaram Finance, founded in 1954, is a conservative lender to truck buyers. But in recent years it has branched out into other loan streams, including car finance, as competition increased. He is now looking to take advantage of the technology and the prospects of the Indian economy which is expected to experience a boom in the rural economy and infrastructure construction.

“Rural India continues to remain quite strong and therefore bodes well for the future,” Lochan said. “On the back of normal monsoons, good buys, good seedlings and downside fears not materializing, the rural segment has been quite robust.”

He said a good indication of this was the results that the FMCG companies were witnessing on both the volume and price fronts. Lochan, however, said urban markets were also seeing more optimism and confidence in part thanks to advances in immunization. He further added that the company would remain a provider of asset lending, going beyond commercial vehicles to passenger cars, material handling and construction equipment.

“The infrastructure space currently appears to be in dramatic investment mode. Likewise, with the opening up of rural agricultural opportunities through unprecedented reforms in this space, which we hope to see implemented over the next few years, I believe that opportunities in this space will also open up. ”

The government has accelerated spending in rural areas through housing programs, direct transfer of subsidies. He also recently announced the Gati Shakti program which would absorb national infrastructure projects worth 110 lakh crore.


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