Dhirendra Kumar CEO, Value Research said that he had an interesting conversation with one of the depositors of Sahara some 24 hours after Sahara’s Subrata Roy was arrested at the command of the Supreme Court. He was even willing to do the deposits in future too. He knows many people who are regular Sahara depositors. He had two schemes with him.
One which offered a gain of 10% for one year tenure and the other one offered 40% gain for a deposit period of 48 months. There is still financial business being conducted under the name Sahara brand. This particular depositor is well educated and knows all about the wide range of financial instruments. There are really a large group of depositors who are still willing to use the services of Sahara. There is a lot of noise being made about the interests of depositors by various authorities and media. The Sahara group has been playing the legal tricks with SEBI and RBI is that there is a real savings and investments business that exists. This business is now illegal which is likely to be declining. In 2008 RBI asked Sahara to wind up its business which it didn’t do.
Millions of common investors get lured to their small savings schemes because of reasons more than one. First, these people are quite scary of going to the banks because of their complicated KYC norms. Secondly, these companies offer a much higher rate of interest than the banks.