Shriram Finance is entering an exciting new phase of growth. The company is targeting an 18 per cent increase in business this financial year. This comes after a significant investment and partnership with MUFG, a top Japanese financial services group. Umesh Revankar, Executive Vice Chairman of Shriram Finance, believes this tie-up will lower borrowing costs and provide fresh capital to reach new customers.

The biggest highlight is the plan to lend to the Japanese supplier ecosystem in India. There are nearly 1,490 Japanese manufacturers operating in India, including big names like Suzuki, Toyota, Honda, and Yamaha. Shriram Finance wants to provide loans to their dealers, sub-dealers, and component suppliers. MUFG will help by introducing their corporate customers to Shriram for these retail and supply-chain financing needs.

To support this, the company will launch new products by October 1. These include supply-chain financing, inventory financing (loans to help businesses buy stock), and dealer financing. Traditionally, Shriram Finance focused heavily on used vehicle loans, which made up 90 per cent of their business. With lower funding costs now available, they are shifting toward new vehicle financing, which now accounts for 20 per cent of their vehicle portfolio. Growth is particularly strong in Tamil Nadu, where the company has 843 branches.

Another major focus area is gold loans. Shriram Finance wants to double its gold loan business so it makes up 5 per cent of its total portfolio. Currently, about two-thirds of their branches offer gold loans, but they plan to add 500 more branches to this network soon. This shows a clear intent to diversify away from just commercial vehicles into more secured, high-margin retail assets.

On the hiring front, the company plans to add 2,000 to 3,000 new employees this year. They already have a massive workforce of 80,000 people. They also plan to open 100 new branches by the end of the fiscal year, bringing their total branch count even higher. For bank aspirants, this signals that the NBFC (Non-Banking Financial Company) sector remains a major employer despite global economic shifts.

Addressing regulatory concerns, Revankar spoke about the RBI’s new draft guidelines on revolving credit. Some worry these rules might hurt MSME (Micro, Small, and Medium Enterprises) lending. However, Revankar feels that rolling over loans is a normal part of business for small shops. He mentioned that industry leaders have met with the RBI to explain why these features are necessary for customers.

Interestingly, Shriram Finance has no interest in becoming a bank. Even though they are a large 'Upper-Layer' NBFC, they want to stay as they are. Revankar explained that being an NBFC allows them to be 'nimble-footed.' This means they can innovate faster and customize products for customers better than a traditional bank might be able to do.

For Indian bankers, this story highlights how foreign partnerships are helping Indian NBFCs compete more aggressively in the retail and MSME space. The move into the Japanese ecosystem also shows how deeply integrated global supply chains are becoming in Indian credit markets. Watch for the October launch of their new supply-chain products as a key indicator of their success.