Auto companies say not their line of business

With the Reserve Bank of India (RBI) allowing companies with to act as (BC), automobile companies have an additional business avenue.

Industry experts, however, said the companies might not show much interest as models for the two lines of business were different.

India Chairman said: “It is not our expertise to act as BCs on behalf of banks. We have to understand the implications of such a venture. There are no plans to explore the avenue.”

Ashwin Parekh, partner, Earnst and Young, said: “Automobile companies can act as BCs technically. However, there is no natural connection with the business that they do.” As a BC, automobile companies would have to depute people to collect and dispense cash, which they might not choose to do, he said.

Abizer Diwanji, an analyst at KPMG, agreed: “Telcos already act as service providers and they will be more comfortable in undertaking such a business. can participate but they need to have a significant presence in rural areas.”

Maruti Suzuki, the largest car manufacturer of the country, has 802 sales outlets in 555 cities.

firms to first read fineprint

Most FMCG companies, including Dabur, ITC, and Nestle, said they would study the guidelines before commenting on RBI’s move to involve companies with a large retail presence to act as business correspondents. Mails sent to HUL and P&G remained unanswered.

CEO said: “FMCG companies may not get directly involved in the programme. But they can possibly act as facilitators by encouraging their distributors to take up this kind of work.”

But the chief executive of an FMCG company said on condition of anonymity: “Banking is a different ballgame altogether. The model is vastly different from FMCG. Plus, distributors are not oriented to sell financial products. They are into everyday products like soaps, detergents, shampoos. I don’t think this financial inclusion programme can apply to us. Distribution in FMCG involves a series of intermediaries who we do not control. We are not a retailer who has a network or chain of stores. Possibly he can get into a programme like this? I don’t see how we can make a difference.”

image
Business Standard
177 22
Business Standard

Auto companies say not their line of business

Sharmistha Mukherjee  |  New Delhi 



With the Reserve Bank of India (RBI) allowing companies with to act as (BC), automobile companies have an additional business avenue.

Industry experts, however, said the companies might not show much interest as models for the two lines of business were different.

India Chairman said: “It is not our expertise to act as BCs on behalf of banks. We have to understand the implications of such a venture. There are no plans to explore the avenue.”

Ashwin Parekh, partner, Earnst and Young, said: “Automobile companies can act as BCs technically. However, there is no natural connection with the business that they do.” As a BC, automobile companies would have to depute people to collect and dispense cash, which they might not choose to do, he said.

Abizer Diwanji, an analyst at KPMG, agreed: “Telcos already act as service providers and they will be more comfortable in undertaking such a business. can participate but they need to have a significant presence in rural areas.”

Maruti Suzuki, the largest car manufacturer of the country, has 802 sales outlets in 555 cities.

firms to first read fineprint

Most FMCG companies, including Dabur, ITC, and Nestle, said they would study the guidelines before commenting on RBI’s move to involve companies with a large retail presence to act as business correspondents. Mails sent to HUL and P&G remained unanswered.

CEO said: “FMCG companies may not get directly involved in the programme. But they can possibly act as facilitators by encouraging their distributors to take up this kind of work.”

But the chief executive of an FMCG company said on condition of anonymity: “Banking is a different ballgame altogether. The model is vastly different from FMCG. Plus, distributors are not oriented to sell financial products. They are into everyday products like soaps, detergents, shampoos. I don’t think this financial inclusion programme can apply to us. Distribution in FMCG involves a series of intermediaries who we do not control. We are not a retailer who has a network or chain of stores. Possibly he can get into a programme like this? I don’t see how we can make a difference.”

RECOMMENDED FOR YOU

Auto companies say not their line of business

With the Reserve Bank of India (RBI) allowing companies with extensive retail networks to act as business correspondents (BC), automobile companies have an additional business avenue.

With the Reserve Bank of India (RBI) allowing companies with to act as (BC), automobile companies have an additional business avenue.

Industry experts, however, said the companies might not show much interest as models for the two lines of business were different.

India Chairman said: “It is not our expertise to act as BCs on behalf of banks. We have to understand the implications of such a venture. There are no plans to explore the avenue.”

Ashwin Parekh, partner, Earnst and Young, said: “Automobile companies can act as BCs technically. However, there is no natural connection with the business that they do.” As a BC, automobile companies would have to depute people to collect and dispense cash, which they might not choose to do, he said.

Abizer Diwanji, an analyst at KPMG, agreed: “Telcos already act as service providers and they will be more comfortable in undertaking such a business. can participate but they need to have a significant presence in rural areas.”

Maruti Suzuki, the largest car manufacturer of the country, has 802 sales outlets in 555 cities.

firms to first read fineprint

Most FMCG companies, including Dabur, ITC, and Nestle, said they would study the guidelines before commenting on RBI’s move to involve companies with a large retail presence to act as business correspondents. Mails sent to HUL and P&G remained unanswered.

CEO said: “FMCG companies may not get directly involved in the programme. But they can possibly act as facilitators by encouraging their distributors to take up this kind of work.”

But the chief executive of an FMCG company said on condition of anonymity: “Banking is a different ballgame altogether. The model is vastly different from FMCG. Plus, distributors are not oriented to sell financial products. They are into everyday products like soaps, detergents, shampoos. I don’t think this financial inclusion programme can apply to us. Distribution in FMCG involves a series of intermediaries who we do not control. We are not a retailer who has a network or chain of stores. Possibly he can get into a programme like this? I don’t see how we can make a difference.”

image
Business Standard
177 22
Widgets Magazine

More News

Widgets Magazine
Widgets Magazine
Advertisement

Upgrade To Premium Services

Welcome User

Business Standard is happy to inform you of the launch of "Business Standard Premium Services"

As a premium subscriber you get an across device unfettered access to a range of services which include:

  • Access Exclusive content - articles, features & opinion pieces
  • Weekly Industry/Genre specific newsletters - Choose multiple industries/genres
  • Access to 17 plus years of content archives
  • Set Stock price alerts for your portfolio and watch list and get them delivered to your e-mail box
  • End of day news alerts on 5 companies (via email)
  • NEW: Get seamless access to WSJ.com at a great price. No additional sign-up required.
 

Premium Services

In Partnership with

 

Dear Guest,

 

Welcome to the premium services of Business Standard brought to you courtesy FIS.
Kindly visit the Manage my subscription page to discover the benefits of this programme.

Enjoy Reading!
Team Business Standard