CEO Insights Magazine

Though banking sector plays a significant role in the Financial Markets a lot, the non-banking financial companies are also playing a very vital role too. They are competing with banking sector by providing various financial services. NBFCs are financial intermediaries engaged in the business of accepting deposits, delivering credit while they play an important role in channeling the scarce financial resources to capital formation. In India, still, a major chunk of the population resides in villages and smaller towns which are not served by the mainstream banks. Addressing these challenges, the NBFC-MFIs like Arohan Financial Services has been providing its valuable services to society for more than 15 years, in order to improve financial inclusion and most importantly the women empowerment. NBFCs supplement the role of the banking sector in meeting the credit and saving needs of the unorganized sector and to small local borrowers.

Being one of the top 10 NBFC-MFI in India, Arohan offers a broad range of products to financially underserved customers. Their financial products are classified into credit and insurance products. The credit products include income generating loans and other loan products for various house hold purposes. Their insurance products include life and health insurance covers issued and underwritten by certain Indian insurance companies with whom they have entered into tie-ups. The business of Arohan is spearheaded by Bharath Sondur who is responsible for the end-to-end business operations of the company starting from strategic and tactical perspectives covering products, planning, as well as, alliances.

Bharath recently engaged with CEO Insights magazine where he talks more about his professional journey and the unique business operations of Arohan, here's the highlight from the same.

Give a brief account of your educational & professional background and what inspired you to become the CBO of Arohan Financial Services?
I belong to a place named Shimoga in Karnataka and I am a Science Graduate. Later, I pursued a postgraduate diploma in computer applications and in those days, I wrote quite a few computer exams and qualified. One of them was that of the banking services recruitment board. My career started with the State Bank of Travancore where I worked for about four and a half years after which I switched to a private sector bank named Global Trust Bank.

Global Trust Bank was the first private sector bank in Mysore and I got attracted to the kind of vibrancy the private sector banks carried. I was with this bank for a couple of years and then I moved to the HDFC Bank. I was there in HDFC for six years and I am the longest-serving branch manager for a branch in Bangalore till date. I was promoted as the Cluster Head for Karnataka and I was managing retail branch banking business for HDFC Bank. In 2006, I joined ING Vysya Bank, which was a Bangalore based private Bank as Region-al Head for Karnataka. After a couple of years in ING Vysya Bank, I got an opportunity to move to Bahrain with the Bank of Bahrain and Kuwait.

One of my earlier reporting mangers in ING Vysya Bank had joined Janalakshmi Financial Services

which was an NBFC MFI based at Bangalore, who wanted to set up a corporate BC for Bank in order to gain expertise in liability business, called me and I was convinced to join an NBFC MFI as National Head for BC business. I was with JFS for about eight years in which I not only managed BC business but handled the core MFI business for South and then moved to Delhi managing North, Central and Eastern zones. By 2015, JFS got the license for a Small Finance Bank and I was to move in to HO for heading the liability business for the proposed Bank. In the meantime, had an opportunity to meet the founder, MD & CEO of Suryoday Small Finance Bank in an event and he made me to join them as CBO for Retail Banking for Suryoday SFB based at Mumbai.

I worked with them for about three years and nine months and later on joined Arohan Financial Services as CBO to be based at Kolkatta in Dec 2021. Here, am responsible for end to end business in core business of micro finance, business loans, products & processes, quality, recovery and the cross sell products. We have about 750 branches spread across 14 states, we will be adding another 100+ branches in the next three months and adding another three new states to our network.


Define Arohan Financial Services as an organization and its current position in the industry.
Arohan is one of the earliest entities of the microfinance industry in India. It was taken over by Aavishkaar Group which is a financial conglomerate focused towards impact investing, consulting, microfinance and other aspects related to development finance. Arohan Financial Services has its operations focusing on low-income states of India. It provides income generating loans and other financial inclusion related products to customers. Apart from that, we also offer health insurance, life insurance, asset insurance, bank account opening, and cash credit services. These are predominantly offered to customers who are not having access to formal credit system and provided at their door step.

Arohan is headquartered in Kolkata and it is predominantly present in the North, East, and Northeastern part of the country. We also have plans to expand to the Western and Southern parts of India this year. Currently, Arohan is present in 14 States with 750 Branches. The business was adversely impacted in the last two years due to the outbreak of COVID, but things have come back on track and now we are rolling out a cautiously aggressive plan for the current financial year to achieve newer heights.

Could you tell us about the unique services that are provided by the Arohan Financial Services that make it unique in the market?
Arohan Financial Services is not the pioneer in this industry but still manages to be in the top 10 in the country in terms of our book size and the business volumes. And in terms of people and the way we manage them both internally as well as externally, we have been rated as

one of the great place to work and that too consistently for the last four consecutive years.

Arohan is in a business wherein it focuses on empowering the underserved society, especially women of the underprivileged society. We offer affordable and beneficial products and plans to our customers. We also have a plan to start Micro Systematic Investment plans (SIPs). This will allow women to invest as low as 100 rupees a month into Systematic Investment Plan in mutual funds. We have started an initiative wherein we also do carbon credits or the savings as carbon credit generating activities which helps the customers in buying solar electrical panels, electrical cookers, and so on. We cover our customers with insurance, provide them savings and we ensure that they are digitally onboarded with 100 percent cashless disbursements. We are truly paperless for our customer onboarding process and almost 93 percent of our collections come from cashless /digital collection mode.

We are the first NBFC MFI to implement the board approvedpolicy on the new guidelines from RBI which was released in the month of March. As an MFI we are the first one to startdigital lending for MFI customers, those who are repeat customers of Arohan can apply for a new loan and get it credited to their savings account with their Bank in less than 10 minutes. This is the first time ever an NBFC MFI has done something unique like this. We would like to expand this to all our existing customers first across the markets soon.

Being the CBO of the company, how do you plan to apply your exceptional understanding of the domain in Arohan Financial Services and take it to the next level?
I'm a banker who has worked across multiple banks with different work cultures. I started in a public sector bank then I worked in private sector banks followed by a foreign bank and this exposure has given me a wide experience of banking systems in different markets in this sector. Working in various parts of our country has given me an advantage by making me well versed with the culture and the people. The other advantage I have got is that working across different type of banks as mentioned earlier and with microfinance, is to bring in different best practices to Arohan for enhancing and further improving the robust practices we already have.

What advice would you give to the upcoming leaders in the industry?
I would like to tell the upcoming leaders that like any other industry, this industry has huge growth opportunities and the demand for formal credit is growing and there is enough support from regulators, Banks and investors. The recent guidelines issued by RBI is a clear indication that this is a very well regulated industry and this industry has the potential to grow beyond regular banking. Leveraging the technology for the growth, analytics and controls is definitely a huge opportunity. Those who implement the technology will grow much faster and in a very controlled way.

Bharath Sondur, Chief Business Officer, Arohan Financial Services
Bharath Sondur is an industry veteran who has more than two decades of experience in the banking sector and is using his wide experience in this domain to lead Arohan Financial Services on the path to success.

Quick Facts
Hobbies:Playing Golf, Cricket & Following Politics
Favorite Cuisine:South Indian Food, I am an avid Idli lover & hardcore filter coffee addict
Favorite Book:A Bank for The Buck, The story of HDFC Bank by Tamal Bandyo padhyay Favorite Travel destination Coorg & Mysore (they are like my second home)