Janalakshmi to Focus on Financial Inclusion of Urban Poor
Monday, March 8, 2010
Narayan Ramachandran, Ex-Country Head and Managing Director of Morgan Stanley India has decided to focus on financial inclusion of the urban poor. He has been now appointed as the Director on the board of Janalakshmi Financial Services run by Ramesh Ramanathan, who is the Chairman of the organisation.
Here is a verbatim transcript of an exclusive interview with Narayan Ramachandran and Ramesh Ramanathan on CNBC-TV18. Also watch the accompanying video.
Q: How does it feel to be the Director on board of Janalakshmi Financial Services?
Ramachandran: I wanted to be associated with this organisation. It’s almost as if I designed what I wanted to do. It’s bang in the space of where I wanted to be, which is opening out financial access to sections of the population that probably easily defined as underserved but not just in credit, which is what’s happening now but also beyond that.
Q: You have some ambitious plans for Janalakshmi. Can you outline some of those for us?
Ramanathan: There is a lot of experimentation going on, on how do we do justice to the issues of financial inclusion, but harnessing market forces while you are keeping the social agenda intact. It’s a difficult kind of a line to walk across. So, one ambition for Janalakshmi is that we have created a unique two tier structure. We have a not for profit holding company in which all the promoter stake is kept but we have an operating company in which there is no confusion, it’s a market driven organization, its going to raise money from investors, its going to hire good people and reward them well. We want to make this two tier structure work, which is the concept of a social business doing just as both legs of the stool.
We are very ambitious for what we think needs to be done for financial inclusion. We have certain focus which is urban poor, the urban underserved as Narayan would like to call it. It’s a huge issue and it’s not unfortunately on the radar screen of most people. It’s one of those creeping issues that it is only growing because India has already 300 million people in urban India. It’s going to be 600 million people, 40% of whom do not even have any access to financial services. So we hope that we can play a big role in addressing that issue.