Growing by serving the common man

It will soon be 15 years since Wharton School published the landmark study and book, The Fortune at the Bottom of the Pyramid by late LIS tuned business management piru of Indun origin Prof. CK Prahalad and business sustainability expert Prot. Stuart L Hart in one sense, what the renowned professors consultants were espousing was not something new, but as the cave studies (mostly from Indian themselves showed, it was a bine philosophy that had existed for decades, and in some companies like Muthoot Pappachan Group (which was not covered in the book for more than a century

But for most readers as well as businessmen, this idea was something totally new. Because conventional business wisdom taught that more affluent the target custumen, pricier can be the product

AROUND 1 LAKH COMMON INDIANS MEN AND WOMEN WALK INTO THEIR 3600 BRANCHES ACROSS THE COUNTRY EVERY DAY THEY COME FOR MEETING THEIR DIVERSE FINANCIAL NEEDS FROM A SIMPLE GOLD LOAN TO A TWO-WHEELER LOAN TO AN MSME LOAN. BUT ACROSS ALL THESE BRANCHES THEY GET THE SAME FRIENDLY TREATMENT-WHAT MPG CALLS THE ONE MUTHOOT EXPERIENCE

and therefore, higher the profit margins possible. The words of Microsoft founder and one of the richest guys in the planet, Bill Gates, about this book summed it up quite nicely it offers an intriguing blueprint for how to fight poverty with profitability.

While everything from cheap smartphones to two-minute noodles have been projected as examples of the fortunes at the bottom of the pyramid, this revolutionary model of doing business shows in maximum potential when it comes to delivering what the people at the bottom of the pyramid lacks the tot that money, in another world of financial services

The wider world cause to know about it only in 2006 where Bangladeshi academician Prol Muhammad Yunus and his brainchild Grameen Bank landed the Nobel Peace Prize Through the microfinance revolution be unleashed, the fortune at the bottom of the pyramid literally went through the roof surpassing the expectations of any theorists, Muthoot Pappachan Group too has a significant microfinance arm, but their focus on the bottom of the pyramid goes much, muchback, precisely to 131 years back

The year was 1887, an eventful year throughout the world. In Germany, Gottlieb Daimler unveiled his first automobile, in what would evolve into Daimler AG the holding company of Mercedes-Benz. In France, construction of Eiffel Tower began. In Britain, Arthur Conan Doyle introduced his legendary detective character, Sherlock Holmes. In USA, the renowned National Institutes of Health was founded. And in India, young Mohandas Karamchand Gandhi was just months away from leaving for London for higher studies, while in Kerala, Sree Narayana Guru was just months away from consecrating the first ever temple for the so-called untouchable castes.

It was in this same year that Muthoot Ninan Mathai started his modest wholesale and retail business of grains. Muthoot was his family

name, which was a traditional Orthodox Christian family based in Kozhencherry. His customers were mainly the large British owned estates in the vicinity and their workers. Anyone else would have continued with that same business line or diversified into just supplying more such goods. But Muthoot Ninan Mathai had an eye for discovering unmet needs of these workers, The same eye that appeared in Prof. Muhammad Yunus nearly hundred years later and in

THE LEADERSHIP OF ITS COMPANIES LIKE MUTHOOT FINCORP IN ITS SECTOR OF GOLD LOANS, AND THE BLISTERING GROWTH TRACK OF ITS AUTO LOAN PROVIDER MUTHOOT CAPITAL SERVICES LTD WILL HELP THE GROUP BE ON A SOUND FOOTING WHEN MUTHOOT MICROFIN, MPG'S MICROFINANCE ARM, GOES FOR ITS IPO SOON.

chroniclers of the phenomenon like Professors CK Prahalad and Stuart L Hart yet wo more decades lates

This eye not just a business eve but a philanthropic eye. Like Prof. Muhammad Yumus, Muthoot Ninan Mathal was moved by the lack of savings in these poor workers During those times banks were fate and also catered mainly to rich customers. So he pioneered a chits fund business to inculcate the savings culture in these workers 11 it were just profitable eyes, rest assured these models would have failed eventually in sustainability, be it chit funds or microfinance.

When Muthoot Ninan Mathai's chit funds became a success inside the estates, he floated it for customers outside the estates and the business started growing steadily. By the 1950s it became clear to the now mature entrepreneur that, yet another unmet need existed in his community of customers lack availability of easy credit, as banks were not serving these customers at all. Thus was born Muthoot Ninan Mathai's second core diversification into gold loans. Soon he became the largest player in both chits and gold loans, and customers from across Kerala would come to Kozhencherry for availing these services.

Muthoot Pappachan (Mathew M Thomas) was one of the four sons of the Patron Founder Muthoot Ninan Mathai. In 1979, the partition of this business family happened, 92 years after it was founded, and Muthoot Pappachan became the Founder of Muthoot Pappachan Group.

Like his illustrious father, Muthoot Pappachan too had an eye for meeting the unmet needs of his customers. That is how the Group's flagship financial services business grew from strength to strength, encompassing almost all financial services required by the unbanked customers.

MPG'S ONLY STOCK-MARKET LISTED COMPANY, MUTHOOT CAPITAL SERVICES HAS PUT UP A BLISTERING PERFORMANCE IN RECENT QUARTERS, RIDING THE RESURGENCE IN TWO-WHEELER SALES POST THE DEMONETISATION AND GST CRISES. THE STOCK HAS MORE THAN DOUBLED DURING THE PAST 12 MONTHS, AND GROWN 8 TIMES DURING THE LAST 24 MONTHS.

Under the more professional leadership of late Muthoot Pappachan's three sons, the group went on to diversify more into the financial inclusion business including microfinance and affordable home financing. Today this three member apex team of Thomas John Muthoot (Chairman & Managing Director), Thomas George Muthoot (Director) and Thomas Muthoot (Executive Director) lead the 20,000 employees of the sprawling Muthoot Pappachan Group (MPG).

During the last few decades, MPG also made its mark in several non-financial sectors especially automotive dealerships, hospitality and real estate development. Today, MPG is a leading sales and service partner for world renowned car brands like Jaguar, Land Rover, Ford and Honda in various cities of Kerala, and for leading two-wheeler brands including Honda, Yamaha and Vespa in the state.

In hospitality, MPG owns renowned properties like Villa Maya which is a lovingly restored 18th century Dutch Manor in Trivandrum; Vivanta by Taj Green Cove at Kovalam, Trivandrum; Hilton Garden Inn in Trivandrum; and the Muthoot SkyChef, the Group's inflight catering division of international standards.

MPG's realty division has brands like Muthoot Commerz which owns Muthoot Technopolis, a 3,55,000 sq ft, state-of-the-art IT Park designed by Jurong of Singapore; Commerz Capital at Trivandrum which is a 48,000 sq ft office and commercial space; and Muthoot Commerz owns the 14th floor spanning 40,350 sq ft of the World Trade Centre at Bangalore which is now leased out to Amazon Development Centre.