Shriram Group’s founder Thyagarajan says lending to poor is socialism and can be profitable: Report
Bloomberg News. And by offering a cheaper rate than the punitive rates available to the unbanked, Thyagarajan has proved that the lending business can be safe and profitable. In an interview, Thyagarajan told Bloomberg News that “he entered the industry to prove lending to people without credit histories or regular incomes isn’t as risky as it’s perceived".
According to Bloomberg News, Thyagarajan said that there is nothing unusual about his approach to business — or his decision to give away a stake in Shriram. “I’m a bit of a leftist," Thyagarajan said in the interview. “I was never enthusiastic about making life pleasanter for people who already have a good life." Rather, I “wanted to take away some unpleasantness in the lives of people who are getting into problems." Thyagarajan gave away almost all his wealth to a handful of employees.
In July, shares of the group’s flagship company Shriram Finance Ltd rose to a record high after surging over 35% this year. Shriram Finance has a market capitalization of about $8.5 billion and reported about $200 million in profit in the June quarter of fiscal year 2024. In 1961, he joined New India Assurance Co.
He also worked at Vysya Bank and reinsurance broker JB Boda & Co. During this, people use to come to him for money to buy used trucks. He gave them loans from his inherited wealth.
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