Using the same tack

Why Ramesh Iyer of Mahindra & Mahindra Financial Services does not want to be a banker

Historically, non-banking financial company (NBFC) has been a four-letter word and has almost always been at the receiving end of regulatory action in India. While that may have been true in the past, NBFCs’ contribution to greasing the economic wheels is a reality and now, even the RBI agrees that they are an important component of the financial system.

Not used to much pampering, many NBFCs queued up to apply for a banking licence when the floodgates were recently opened for new licences. Well, if the regulator wants to embrace you with open arms, why not make the most of it? After all, the regulatory framework aside, the biggest cross that NBFCs bear is their high cost of funding. In a liquidity-starved environment, their loan-book growth comes to a halt and the same is true of the current times where availability is not an issue, but cost is.

While the motivation for becoming a bank may differ from NBFC to NBFC, there clearly were some who were in it for the long haul. Mahindra & Mahindra Financial Services was among them and, unfortunately, its plan hit a regulatory hurdle. Having taken a conscious decision of not going ahead with its application, the management intends to build on its existing business model. How it intends to do so and what is it that sets it apart from other NBFCs is the subject of this issue’s cover story: Sticking to his knitting

Then, there is a feature on Pidilite, whose Fevicol brand needs no introduction. Many hardware vendors prominently display Fevicol cans outside their stores as it helps pull in carpenters who end up buying other merchandise. There is no greater example of a brand living up to its promise of stickiness. You can read more about Pidilite’s plans: Can Pidilite keep blowing its trumpet? .

Finally, we have a tale on why many companies have jumped into peddling fragranced air in a can. The industry has smelt money and with enough gullible suckers falling for the over-the-top imagery used to sell deodorants, almost every day a new player is jumping in. Find out who’s smelling good: Long lasting .