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success through sound networking
It’s raining well-deserved accolades for Akhila Srinivasan, Managing Director, Shriram Life Insurance Co Ltd.

A FEW WEEKS ago she received a doctorate from Madras University on a thesis in micro financing. Soon after, Forbes named her as one among top six powerful Indian businesswomen.

Akhila Srinivasan is known for her leadership and networking capabilities at the Shriram Group, which she joined nearly 30 years ago. One remembers her success in building a vast network of managers and executives spread across India to expand the transport finance business, the forte and flagship activity of the group.

When RBI made conditions for NBFCs tough for resource mobilisation, Srinivasan along with R Sridhar and guided by Chairman R Thyagarajan (RT), tapped in quick succession Citicorp and investment banks in Netherlands to invest handsome amounts in STFC. These continued with successive expansion of the investors with increased valuations with the Piramal Group as the latest. Today the group is the largest NBFC with assets funded in excess of Rs 60,000 crore.  

Equally precious is the group forging collaboration with the South African giant Sanlam Insurance. Among life insurance businesses Shriram Life has been unique in earning profits even during the first three years of its establishment!

Srinivasan is understandably happy over the recent budget announcement on the formation of Mudra Bank entrusted with funding and regulation of medium and small enterprises widely serviced by NBFCs.


Funding first time entrepreneurs...

When Srinivasan joined the Shriram group in 1986 as a trainee, the chit fund and truck financing arms were small entities. With her flair for communication and brand building, she set about the task of financing used trucks: “I was active in fixed deposit mobilisation. I had to create awareness all over India and build an image for the company. It was not that we were just financing them; but we lent support to millions to realise their dreams of owning trucks and becoming entrepreneurs on their own.” Her effectiveness  took her up the career ladder; she became President of the organisation in just eight years’ of joining.

Post the 1997-98 Asian financial crisis was a testing time for the micro finance industry. RBI had tightened its norms: “we had deposits worth Rs. 700 crore. RBI directed pruning these drastically and most NBFCs folded up. But due to proper tenure match between lending and borrowing, Shriram group was one of the few companies that survived,” she said.

With her networking skills, Srinivasan bought in new investors. “I went to Netherlands to the FMO on a cold call. I gave a brief about our working and returned to India. Few weeks later the fund managers were in India doing a due diligence,” said Srinivasan.

    FMO sanctioned a loan of Rs 60 crore at concessional rate of interest and also invested in the equity of the company. This was soon followed by Axis Bank which securitised Rs 500 crore worth receivables. Citibank joined in a big way to securitise receivables of the trucks financed.  “We have public deposits, institution deposits and bank deposits. Our public deposits are at Rs 10,000 crore now,” she pointed out.

Our target is Aam Aadmi...

Srinivasan is credited to building Shriram Life Insurance to what it is today. “I had to replicate what was done in truck financing building the business from scratch.” Started in 2005, the company earned profits for the first three consecutive years becoming the only Indian life insurance company to achieve this distinction. “Our target customer is the aam aadmi and our aim is to empower families through insurance. We have played a huge role in financial inclusion by making credit available to segments which don’t have access to it. It could be truck operators or small traders,...” said Srinivasan.

The company has issued 12 lakh policies.  Individual life policies are around 11.5 lakh and the total lives covered 28 lakh. Total premium income is Rs 4280 crore and individual new business premium Rs 2800 crore. “Shriram Life Insurance will grow at 25 per cent this year which will be higher than the average growth of the industry,” she said.

“Life insurance penetration in India is very low at just 4 per cent. The increase in FDI limit to 49 per cent will help expand our reach. The experience and expertise of Sanlam helps us in this,” said Srinivasan.

With a PhD in economics on the subject of micro-credit for women entrepreneurs, Srinivasan is notably happy with the budget announcement on MUDRA Bank. “This will make credit available at cheaper interest rates to small businesses which were hitherto deprived of credit; they have been borrowing from money lenders at high interest rates. When it gains momentum, the country’s GDP will grow faster,” said Srinivasan.

Yet another facet of this leader is her concern for social welfare. Srinivasan heads the Shriram Foundation started in 1993, which acts as the CSR wing of the group. The foundation has set up several orphanages and runs schools in rural areas. The school at Thiruneermalai has 520 students. Srinivasan said: “we are embarking on a Mission 100. It aims to build 100 schools. We will be opening 20 schools in Andhra Pradesh next month and by next year we will open 20 more. These schools focus on marginalised children in rural areas. We offer quality and holistic education for free.” To start a school in Tamil Nadu one needs land that is expensive. While in Andhra Pradesh the land to start a school is not a constraint.

The foundation has a budget of Rs 12 crore and 60 per cent of it is spent on education. The foundation aims to address skills development. “This year we have trained 5000 truck drivers at our driving school in Pune. These are tenth grade students who have either failed or dropped out. We give them six months of training. In the next three years we plan to train 20,000 and we will extend these training to government ITIs also,” said Srinivasan.

Starting as a trainee to have climbed up the ladder as MD, the journey of Srinivasan is inspiring. The young debator at college, whose batch mates have also gone places,  has come a long way indeed.

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