Presence of credit bureaus in India is a chance to potentially grow to be a larger industry than the private equity industry - Shyam Maheshwari

Shyam Maheshwari SSG was the former Chief Executive Officer, Founder and Partner of SSG Capital Management, and is primarily responsible for SSG’s investment activities in India. He has 17 years of experience in the deal sourcing, analysis and investing industry.  Shyam Maheshwari is Associate Member at The Institute of Chartered Accountants of India and on the board of 5 other companies.

Shyam Maheshwari details the role of private credit as the key factor in the fastest growing alternative asset class in the world, as it has been for the last 4 to 5 years. In the 2009 global financial crisis, lots of debt capital has been flowing through asset managers rather than banks. Today over a trillion dollars in size, bank lending is shrinking on account of all the increased regulations. The ability of independent asset managers to up this share advocated by banks is the global trend, he says.

Shyam Maheshwari was the former Chief Executive Officer, Founder and Partner of SSG Capital Management, and is primarily responsible for SSG’s investment activities in India. 

According to Shyam Maheshwari, the Indian credit market has been dominated by banks and non-bank financial companies for a long period. It started primarily with dominance of PSU banks and then the private sector banks. The credit to GDP ratio is relatively low for the stage of growth of the country. Shyam acknowledges that the NBFC’s have been facing their share of challenges in the past 2 years as it is well known. Shyam Maheshwari advices that the Indian businesses need to hold against the domestic and international competition which also includes export markets. They also need to innovate and expand the fast growing unique technological and customer landscape for matching with the competition in the sector.

Post IFS crisis and the continued bank NPA crisis, credit in India has become a huge need for growing companies as well as troubled companies, Shyam Maheshwari explains. NBFC’s stopped getting that space and alternative asset managers are entering that position. Private credit as an asset class is still scaling up in a relatively small basin of India. “India is about a 3 trillion-dollar economy and is growing at a rate of 6 to 7 percentage. This is critical for the market and is a huge growth potential”, affirms Shyam Maheshwari.

Maheshwari also confirms that the presence of credit bureaus in India as compared to other markets will enhance the use of anti-fingerprint credit. There is also a large opportunity for investment in this sector for about 25 to 100 billion dollars over the next 4 to 5 years. This is a chance to potentially grow to be a larger industry than the private equity industry, explains Shyam Maheshwari. The fact that they have nearly 290 billion dollars of private credit available highlights an opportunity for the Indian economy, and it acts as a catalyst for opening up endless possibilities for Indian businesses as in navigating the next normal.