Why niche banking matters

The Shriram group has succeeded by taking credit to its last mile, where commercial banks typically fear to tread.

Why niche banking matters
Providing credit for the little man can be big business (AFP)

The combination of retail and commercial lending with investment services, or universal banking, has long been the Holy Grail of the finance industry. In theory the model allows for unimaginable efficiencies that reduce the cost of capital for every kind of borrower and provides the rationale for an integrated financial services business.

But most banks, despite their best intentions, are anything but universal. They often fail to touch even those within their reach and most...

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