9 February, 2005: CHOLAMANDALAM financial services group, part of Murugappa group, plans to grow its captive BPO business leveraging on the strength of its domain knowledge, brand and operating as a pan-Indian composite financial services provider offering a range of products and services like vehicle finance, insurance and stock-broking.

As part of Cholamandalam's game plan to aggressively build its range of businesses and also take care of back-end operation, a new entity, Chola Business Services Ltd has been floated by Cholamandalam Investment and Finance.

The NBFC, which expects its disbursements to cross Rs 1, 000 crore this year, is keeping its options open on adopting the banking structure. MD M Anandan said, "Once there is clarity on bank ownership issue with out restricting the stake and voting rights to 10% we will take a call on becoming a bank either through a green-field route, conversion or by acquisitions."

Regarding plans to build the new BPO business, he said, "We want to separate front office and back-end operations. We have also set up a data storage and recovery centre at Guindy. Chola Business Services will take over the existing back office operations and look at scaling up the business utilising the six lakh customer base of the financial group."

He said the NBFC started the process centre in a small way in 2001 with about 20 staff. It has now grown into a 135-member team handling part of the back-end operations of vehicle finance and general insurance business of Cholamandalam MS General Insurance.

Of this, Cholamandalam has taken a large space at Dare House for the centralised process centre for vehicle finance. It has about 70 staff exclusively processing the documents relating to vehicle purchase, loan disbursements and post dated cheques (PDCs).

As on date, there are 25 lakh PDCs on hand and about 90,000 cheques are presented by the centre for collection every month. The NBFC has about 1.2 lakh vehicle finance customers.