Finshots Daily The MUFG–Shriram Finance Deal explained
Dec 24, 2025
Explore the intriguing world of foreign investments in Indian finance and why 2025 has become a landmark year. Discover how MUFG's investment in Shriram Finance offers a unique opportunity in the thriving NBFC sector. Learn what sets Shriram apart, from its diverse lending strategies to its impressive growth metrics. Understand the advantages of NBFCs for foreign investments compared to traditional banks. Dive into Japan's search for better yields and how this deal benefits both parties, enhancing credibility and access.
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Record Foreign Bet On Indian NBFCs
- MUFG is buying a 20% stake in Shriram Finance for ₹39,600 crore, valuing it near ₹2 lakh crore.
- This is the largest finance-sector deal of 2025 and marks big foreign capital entry into Indian finance.
NBFCs Offer A Practical Entry Path
- NBFCs lend like banks but without full banking licenses and therefore offer more acquisition flexibility for foreign investors.
- MUFG chose an NBFC route because strategic stakes and board influence face fewer regulatory hurdles than buying a bank.
Shriram's Deep Real-Economy Franchise
- Shriram Finance operates across CV, MSME, vehicle and gold lending with over 3,200 branches and 9 million customers.
- Its core businesses tie directly to repeat credit cycles in India's real economy, making it a scalable, profitable franchise.