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Advantages of social business discussed by banking experts

“Social business means to make profit with a goal to give back to the society. Poverty in our economy is too deep-rooted to be eradicated easily. Poverty can be reduced only when services reach rural areas,” said N K Thingalaya, former chairman and managing director of Syndicate Bank.

He spoke after inaugurating the workshop on ‘Social Business in India: Opportunities and Challenges’ organised by Nitte University, Mangaluru in association with Social Business Academic Network (SBAN) India Chapter at Nitte Education International, Mangaluru at SBRR Mahajana FGC premises.

In his keynote address, Thingalaya said that the concept of Grameen Bank in Bangladesh started by Prof Yunus has helped in the development of social business in that country. The banking expert pointed out how our country had failed to reach out to the rural populace by citing the examples of bank accounts and healthcare facilities. Citing the recent statistics released by RBI, he pointed out that out of 144 crore deposit accounts in the country, 14 crore are credit accounts and out of them only 4.91 crore are rural credit accounts. “Reaching out to the rural population in India is a challenge. How can we reduce poverty in such a scenario?” he asked.

Referring to the increasing number of farmers’ suicides in the country, N K Thingalaya said it was due to loans from external sources and not bank loans. This has added to the debt burden in rural India. “Under such conditions, emphasis should be on social business whose goal is to give back to the society and share the profit,” he opined.

Prof Yashwanth Dongre, Honorary Chair of SBAN said that while social business aims at enhancing social value, typical business units aim at enhancing the value of the shareholder. Social business has a goal; the social business enterprises generally let flow the surplus generated from the sector for a social cause.

Coordinator of SBAN Prof K V Prabhakara read out the message by Nobel laureate Prof Muhammad Yunus before the audience. Ram Mohan Pai, President of Canara Chambers of Commerce and Industry presided over the inaugural function. Dr M S Moodithaya, Registrar of Nitte University; Prof C S Shastry, The Social Business Youth-India members along with staff members were present.

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