LIC Housing Finance Ltd is entering new sectors of business. It has decided to start a subsidiary for the purpose of selling financial products. These would include home loans, mutual funds and insurance policies. The new company would be called LIC Financial Services Ltd (LIC HFL) and is expected to start operations in the next two to three months.
Mr R.R. Nair, newly appointed Director and Chief Executive, LIC Housing Finance Ltd (LIC HFL), said, “This will be a financial services company which will market and distribute all financial products such as home loans, insurance, mutual funds, credit cards and other third party products.”
Speaking on the methodology of entering into the market, Nair did not rule out a possible joint venture or partnership with another company. He said, “While LIC HFL will distribute only LIC HFL’s home loans and LIC’s insurance policies, in the case of other financial products, we may tie up with other companies”.
He also said that there was the need to set up the company which would diversify into more areas, and hence, LIC HFL was born. He added that this will help the housing finance company have an organised channel of distribution that would be professionally managed.
The new Chief Executive, who took over in April this year, also said that, “The company will self –sustain itself by earning its own revenue through fee-based income. It will not be capital- intensive as it will require only working capital.”