Auto finance pioneer Santhanam passes away

T S Santhanam, 92, founder of Sundaram Finance and a key figure in the establishment of some auto component companies in the TVS group passed away on April 15 after a brief illness.

Santhanam, a son of the founder of the TVS group T V Sundram Iyengar, was a pioneer in commercial vehicle and car financing in South India. In 1954, he set up Sundaram Finance to finance commercial vehicles. The company is a dominant player in the field today with an asset base of about Rs 4,850 crore.

He was educated in Madurai and joined his father in business in 1930. He moved to Chennai (then Madras) in 1936, and engaged in auto ancillaries, road transport, finance and insurance businesses.

Sundaram Finance was born when there was just one company, Commercial Credit Corporation, in the organised sector that engaged in vehicle finance. Sundaram Finance soon became the dominant player in this part of the country.

The group supplemented its vehicle finance business with a general insurance company, Madras Motor and General Insurance. Subsequently, the government nationalised the insurance company.

Sundaram Finance's succes rested on its credibility. R Thyagarajan, chairman of Shriram group, said that Santhanam had built the brand of Sundaram Finance on great credibility.

The credibility translated in to unwavering support from its legion of retail depositors. In the mid 70s, Sundaram Finance's low capital base meant that limited deposits could be accepted. The huge demand for its deposits led to the company accepting deposits only from people who registered in advance.

Even in the late 1990s, with turmoil in the non banking finance companies (NBFC) sector, Sundaram Finance's deposit base remained unaffected.

The NBFC industry felt that Santhanam's contribution extended to helping the government understand the importance and nuances of financing commercial vehicles to people largely untouched by banks.

P S Balasubramanium, who for a while headed the Equipment Leasing Association, said that Santhanam's presence on several government constituted committees meant that he helped the industry in an invisible way.

Ashok Leyland's managing director R Seshasayee said that Santhanam set industry standards and motivated others to follow. The institutions he set are an unarguable testimony to the fact that integrity and customer orientation are true requisites for sustained success, he added.

With the advent of economic liberalisation, the wheel seemed to turn a full circle for Sundaram Finance. Santhanam was at the helm as the group once again entered general insurance by joining hands with UK's Royal Sun to float Royal Sundaram Alliance.

The strong brand that Santhanam helped build provided the group the cushion to enter other areas of the financial sector such as mutual funds and housing finance even as the NBFC industry struggled.

Age did not lessen Santhanam's zest for business. People who called on Sundaram Finance's top brass would sometimes find that their hosts suddenly received a call from the chairman seeking an update on the day's business.

Santhanam is survived by his wife, two sons, S Ram, chairman of Wheels India and S Viji, managing director of Brakes India Ltd and a daughter, Prema Ramanujam.