In an interview with BW Businessworld, Shaji Varghese, CEO of Muthoot FinCorp, talks about financial inclusion, technology Integration and commitment to serving underserved communities
In an exclusive interview, Shaji Varghese, CEO of Muthoot FinCorp, sheds light on the company’s dedication to financial inclusion. With a focus on practical solutions and community impact, Varghese provides valuable insights into Muthoot FinCorp’s strategies, technology integration and efforts to serve marginalised populations in the financial landscape.
How has Muthoot FinCorp integrated technology into its operations? What impact has it had on customer experience and service delivery?
Technology adoption is imperative for a superior customer experience and service delivery. As a growing company, we have invested in technology extensively. The company has made substantial investments in this direction through a subsidiary company that focuses only on tech support, application and seamless infrastructure, and another one which is purely focused on innovation that has helped in improving speed, accuracy, productivity and agility.
With the phygital model at Muthoot FinCorp, customers can avail services through physical branches as well as access the services through our website or mobile app Muthoot FinCorp ONE at the click of a button.
Customer onboarding via integrations on digital KYC, instant verification and secure data protocols have led to easy customer transactions and processing. Customers can easily access their loan balance, headroom and subsequent disbursal coupled with drawing power 24/7 through our app. We have strong security systems in place in the branches enabled by technology.
All our branches are monitored every minute through CCTV and our multiple layers of security including motion sensors, password-led transactions and many more are a few examples of technology adoption in security and surveillance.
With the rise of digital banking and fintech startups, how does Muthoot FinCorp stay competitive and relevant in the rapidly evolving financial services landscape?
Muthoot FinCorp is the flagship company of 137 years old Muthoot Pappachan Group (Muthoot Blue) and our experience in the financial services field is supreme. Muthoot FinCorp today is a household name and the trust and legacy speak for itself.
As mentioned earlier, we have evolved with the changing times embracing the digital transformation ensuring to meet the changing expectations and requirements of the customer. We are a one stop solution to our customers meeting almost all their financial requirements that would arise during their lifetime.
New age firms are certainly creating technology capabilities but the challenge they face is physical infrastructure. That’s where companies like Muthoot FinCorp help bridges the gap where we are building our own capabilities.
The segment that we serve cannot be confined to ‘digital only’ or ‘branch only’ aspects and the blend of both is required to meet the customer requirements timely and effectively.
A retail trader earns daily and an easy daily instalment is a more convenient option for him/her. Whether it be in terms of size or scale, we are more equipped to penetrate the deeper pockets of the country to reach the customers ensuring financial inclusion.
We are matching towards Viksit Bharat by 2047 and Muthoot FinCorp will certainly play a contributory role in paving the way for the development of the country by enabling the common man to be part of the formal economy.
How does Muthoot FinCorp contribute to financial inclusion, particularly in underserved or rural areas?
The purpose of the company is to transform the lives of the common man by improving his financial well-being and all our innovations and tech adoptions revolve around the same. The lower middle income segment, which is the country’s much deserved, yet the underserved constitute a majority of our customers.
It’s a conscious decision to serve this segment as it is important to push them to the formal economy by helping them gain access to financial services.
More than 60 per cent of our branches are located in semi-urban and rural areas enabling us to be their neighbourhood financial partner. We customise our solutions as per the needs of our customers.
In FY 23-24, more than 34 per cent of our customers were women, the average ticket size of the gold loan was around 65,000 and around 15 per cent of customers availed of first time credit these are a few indicators of how we are enabling financial inclusion in the economy.
Can you discuss Muthoot FinCorp’s approach to risk management and regulatory compliance in the current economic environment?
Compliance and governance naturally come to Muthoot FinCorp with its legacy and business history of 137 years, which have helped the firm grow irrespective of changes in economic and regulatory environment over the decades.
We have an eminent, diversified and well-established board and management in the organisation who oversees the entire governance aspect.
Looking ahead, what are the key priorities and growth strategies for Muthoot FinCorp in the coming years?
Muthoot FinCorp is one of the leading gold loan NBFCs in India, but we are more than just gold loans. We have now more than two dozen products and have embarked on the journey of shifting from a product firm to a ‘Company of Choice’ to the segment (Lower Middle Income) catering to the lifecycle requirements of our customers.
We will focus on enhancing the technology capabilities ensuring speed and agility in the coming years. With over 3700 branches, the company is all set to expand its footprint in markets where our presence is relatively low ensuring to reach out to the customers who do not have access to easy credit.
Ensuring financial access to our customers is pivotal for us and our strategies are aligned to meet the same while keeping the Purpose of our company as the main anchor.
